BXH encountered a major security incident, triggering a chain reaction.

Recently, the decentralized yield protocol BXH experienced a serious security incident, resulting in approximately $139 million in crypto assets being stolen. The incident occurred on the BSC chain, and assets on other chains have not yet been affected, but the deposit and withdrawal functions for all chains have been suspended.

According to security agencies' analysis, the attackers deployed the attack contract on October 27 and subsequently gained management access to the BXH wallet. On October 30, the attackers used this access to transfer assets from the BXH treasury. Currently, some of the stolen funds have been transferred to other chains and addresses.

This incident has sparked widespread attention and doubt. Many people are confused about how BXH transferred fund management rights to the attacker, and some suspect that there may have been insider involvement. BXH officials stated that the incident stemmed from a private key leak and issued a reward of $1 million seeking help to recover the funds.

What is more concerning is that this incident has also affected other projects that rely on BXH. Multiple liquidity pool projects have been forced to suspend their withdrawal functions, including a project that ranks second in terms of on-chain locked assets, with an associated amount as high as 150 million USD. These projects have stated they are actively monitoring the situation and seeking solutions.

This chain reaction highlights the potential risks present in the current gun pool model. The gun pool amplifies returns by operating cyclically among various lending protocols, but this model also simultaneously amplifies risks. Any issues at any stage could lead to the collapse of the entire system.

Industry insiders point out that the gun pool should improve transparency, publicly disclosing every operation and the flow of funds, allowing investors to make informed choices. Some well-known projects have already adopted this practice, but many projects still have room for improvement in this regard.

In the long run, the gun pool may need to transition to more complex and sustainable strategies, such as option combinations or synthetic asset arbitrage. These strategies have been proven feasible in traditional finance, but they also require a higher level of expertise.

Overall, this incident not only exposed the security risks in the decentralized finance sector but also sparked reflections on the sustainability of the current liquidity pool model. Effectively controlling risks while pursuing high returns will be a key issue for the future development of this field.