May 2025 - KRC Smart Contract Deflationary Mechanism Burn Exploit - $37k (Global)
The KRC smart contract on the Binance Smart Chain was launched on May 22nd.
TenArmor reports that the attack reportedly occurred because the attacker was able to bypass the restrictions in the `transfer()` function and burned KRC tokens from the liquidity pair during each sell swap. As a result, they ultimately received more USDT due to the deflationary burning mechanism.
The loss total was reported by TenArmor as $37.1k.
It's unclear whether or not the project has ever responded to the attack.
The incident was reported on by TenArmor.
There is no indication that any funds have yet been recovered.
It's unclear if there is any investigation undergoing or potential recovery which may be possible.
Further Analysis
An attacker exploited a vulnerability in the KRC smart contract on Binance Smart Chain by bypassing `transfer()` restrictions to burn tokens from the liquidity pair during sell swaps, ultimately profiting $37.1k in USDT through a deflationary mechanism, with no response or recovery efforts confirmed as of now.
How Could This Have Been Prevented?
More Cryptocurrency Exchange Hacks/Scams/Frauds
DAOSquare Treasury RICE Exploit Theft New Token Recovery > > < < Ethereum EIP 7702 Malicious Wallet Draining Phishing Attack
Sources/Further Reading
TenArmor - "Our system has detected a suspicious attack involving #KRC token on #BSC, resulting in an approximately loss of $37.1 K. It appears that the attacker bypassed the restrictions in the transfer() function and burned KRC tokens from the pair in every sell swap, finally got more USDT due to the deflationary burning mechanism." - Twitter/X (Dec 31)
First Suspicious Transaction Against KRC - BSCScan (Dec 31)
Second Suspicious Transaction Against KRC - BSCScan (Dec 31)
KRC Exploiter Address - BSCScan (Dec 31)
Malicious Contract By KRC Exploiter - BSCScan (Dec 31)
Malicious Contract Created By KRC Exploiter - BSCScan (Dec 31)
KRC Token Address - BSCScan (Dec 31)
KRC Token Creation Transaction - BSCScan (Dec 31)
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