Solana Developers Fork Liquidity Hub Serum After FTX Hack

source: coinmash

Serum, the order book based non-custodial decentralized exchange (DEX), was forked by Solana developers after the protocol was compromised by the Nov 11. FTX hack, which led to the loss of over $500 million. 

Solana co-founder Anatoly Yakovenko updated over a twitter response that some developers from the ecosystem are forking Serum because the upgrade key was compromised. “A ton of protocols depend on serum markets for liquidity and liquidations,” he added. 

Soon after, developer Mango Max said that a new version of the app had been deployed with a new program id, and the upgrade authority as well as the fee revenue had been moved to a multi-sig, managed by a team of trusted developers. 

According to Mango Max, the serum program update key was not controlled by the SRM DAO, but by a private key linked to FTX. It couldn’t be ascertained who controlled this key; thus, the program was left vulnerable. 

Serum is a key part of Solana’s DeFi infrastructure, serving as the ecosystem’s central trading order book. It has processed transactions worth more than $32 billion this year with the help of market markers like Alameda and Jump, according to Nomics data.

However, activity on the protocol has fallen over 80% post the FTX fiasco, with an estimated trading volume of around $140K on Nov. 13. 

Other protocols, such as Solend, Raydium, Mercurial Finance, and Phantom Wallet, had limited operations or entirely stopped trading on Serum after the news of compromised key broke out. 

The platforms are now expected to resume operations as the fork has fixed the issue.

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Himan Mohapatra
Himan Mohapatra
Himan Mohapatra is an industry expert within the crypto-sphere and the primary journalist for Coinmash. He is an expert in finance and disruptive tech, such as blockchain.