Cryptocurrency intelligence company Messari has published a report claiming that an attacker was able to exploit an inflation bug on Stellar’s network in April 2017 creating 2.25 billion XLM.
At the time, the bug was estimated to be equivalent to $10 million. It is important to note that they were burned afterward. Messari reported this in a publication released on March 27.
The report estimated that the inflated XLM accounted for 25% of the circulating supply. The illicit Stellar created was later on moved to market and probably sold in early 2017.
It is reportedly said that Stellar burned XLM of similar quantity to correct the supply, maintaining accuracy and ensure token value is not diluted.
As per the research, the addresses and any information in connection to the bug cannot be traced on Stellar Expert or any other block explorers. They can, however, be accessed via the Horizon Application Programming Interface.
The firm alleges that there was no media report on the bug, Stellar’s attack and its decision to burn a similar quantity of XLM.
Currently, Stellar, which is ranked eighth among the largest cryptos as per market cap with a market valuation of $2.07 billion, has not kept the issue from public knowledge.
A Stellar official shared with Messari pointing out that they had mentioned the bug two times and clearly stated in the notes that the network had suffered exploitation. In its statement, the Stellar team admits the significance of a comprehensive disclosure.
The firm acknowledged that Stellar has since the attack risen to be a very important financial software and that their “disclosure standards” have improved. Since the 2017 inflation bug, there has been no other breach, and in case another happened, they would be quick to report about it immediately it’s patched.
The representative concluded by pointing out that, as per last month’s report, the firm’s roadmap for 2019 includes a commitment to total accountancy of all Stellar Development Foundation (SDF) XLM by the end of the year.
More detailed information concerning the old bug will also be part of their commitment.
American based payments firm Western Union (WU) is set to partner with Thunes, a company that previously worked with Stellar- to allow clients of the payments giant to complete direct funds transfer to mobile wallets across the world.
In September 2018, reports indicated that Bitcoin also suffered an inflation bug. It was however discovered by Awemany, a Bitcoin Cash developer and was patched.
Disclaimer: This is not investment advice. Cryptocurrencies are highly volatile assets and are very risky investments. Do your research and consult an investment professional before investing. Never invest more than you can afford to lose. Never borrow money to invest in cryptocurrencies.