Cosmos is now making sure their system won’t share the same fate as the BNB Chain that was drained of $100 million worth of tokens in a hacker attack last week.
On October 13th, Ethan Buchman, co-founder of the Cosmos inter-blockchain communication (IBC) ecosystem, revealed a major security weak point that affects all Cosmos chains that utilize IBC, regardless of the version of IBC they employ.
Inter-Blockchain Communication Protocol allows users to switch seamlessly from one Cosmos blockchain into another.
Blockchains Connected to 42-IBC At Risk
There are currently 42 IBC-enabled blockchains. These include Osmosis and Cronos, Evmos, Cosmos Hub, Cosmos Hub, Cronos, Cronos, and Osmosis.
OKX Chain and Luna Classic are just a few of the blockchains that have already integrated IBC. They were able to disable the functionality or it was disabled completely.
Buchman’s disclosure during the Cosmos Hub Forum is not to be taken lightly especially that all affected networks combine for a total market capitalization of $8.18 billion.
Cosmos founder and co-founder, however, stated that the problem was being addressed through a patch which will be applied to all currently vulnerable blockchains.
Prior to the release of the security risk, validators and developers had access only to the patch.
A third of a blockchain’s voting power must be patched in order for it to be safe from the said vulnerability.
ATOM Price takes a hit
ATOM (the cryptocurrency of Cosmos) is feeling the effects from the possible threat. As a result, its price has dropped.
According to tracking, at press time CoingeckoATOM trades at $11.58, and is down 4.4% in the past 24 hours. As the cryptocurrency is now -10%, its price correction has furthered the drop in value over the last seven trading days.
Coincodex predicts that the price will rise to $13.31 in the coming five days. However, overall sentiment towards the asset is bearish.
According to the provider of online crypto data, 25 out of 28 indicators that are used for ATOM technical analysis indicated bearish signs.
Concerning the Fear and Greed Index the crypto scored 24. That is Extreme Fear. Coincodex also stated that now was a poor time to invest in the crypto asset.
It’s understandable that the digital currency would react negatively to the development announced by Cosmos.
It’s now a waiting game to see if the mentioned solution for the detected threat will allay fears and negativity that pushed ATOM to another bearish rally.
ATOM Total Market Cap at 3.31 Billions on Daily Chart | Featured image from Zipmex, Chart: TradingView.com Disclaimer: This analysis is the author's opinion and should not necessarily be considered investment advice.