BXH has encountered a major security incident, resulting in a loss of nearly $140 million in encryption assets.

On October 30th, the decentralized yield protocol BXH experienced a severe security incident, resulting in a loss of approximately $139 million in encryption assets on the BSC chain. Although assets on the Ethereum, OEC, and Heco chains were not affected, BXH has closed all deposit and withdrawal functions on all chains for security reasons.

According to the analysis by blockchain security agencies, the attack began on October 27. The attackers deployed attack contracts and gained management authority, ultimately successfully transferring assets from the BXH vault on the 30th. Currently, some of the stolen funds have been transferred to other chains and addresses.

This incident has sparked widespread attention and questioning. People are puzzled as to why BXH would grant the attacker control over the funds and whether there was any internal involvement. The BXH officials only stated that the incident stemmed from a private key leak and offered a $1 million reward to recover the funds.

The impact of this event is not limited to BXH itself. Projects that rely on BXH for profit, such as the gun pool project, have also been forced to suspend withdrawal functions, including a certain project ranked second in locked positions on Heco, with an associated amount reaching 150 million USD. This highlights the chain risk in the DeFi ecosystem.

This event has sparked a reflection on the operation model of the machine gun pool. Currently, many machine gun pools amplify returns by cycling operations among various lending protocols, a model that increases risks while amplifying profits. Industry insiders are calling for machine gun pools to enhance transparency, publicly disclosing every step of operations and the flow of funds, allowing investors to make informed choices.

From a risk perspective, gun pool products can be divided into three categories: low-risk single asset collateral vaults, medium-risk automatic compounding of liquidity tokens and platform tokens, and high-risk multi-layer strategy circular lending. Each new protocol added introduces another layer of potential security risk.

Looking ahead, the gun pool may need to evolve towards more complex and specialized strategies, such as options combination strategies and synthetic asset arbitrage. These strategies have already been proven to be sustainable profit models in the traditional financial sector, but they also require a higher technical threshold and expertise.

This incident once again reminds DeFi participants to remain vigilant about security risks, while also highlighting that the entire industry still has a long way to go in terms of risk management and product design.