Back to Blog

The Initial Analysis of the PolyNetwork Hack

Code Auditing
August 11, 2021

The PolyNetwork has been hacked and more than 300 million USDs have been stolen. The attacker performed the attack on multiple chains. In this blog, we use the attack transaction on Ethereum (0xd8c1f7424593ddba11a0e072b61082bf3d931583cb75f7843fc2a8685d20033a ) to analyze the possible reason of the hack. Our initial analysis shows that one possible reason could be either the leakage of the private key that is used to sign the cross-chain message, or there is a bug in the signing process of the PolyNetwork that has been abused to sign a crafted message.

Disclaimer: This blog only contains the result of our initial analysis based on the onchain data on Ethereum. We cannot verify our findings without further information from Poly Network.

Update 2021/08/12: The further information shows that the cause of the attack is because the keeper has been modified by the attacker (not because of the leakage of the private key). We have a further analysis to answer the question why the transaction to change the keeper can be executed in the first place.

Transaction and call trace

We use our transaction analysis system to recover the trace.

Attacker -> EthCrossChainManager -> EthCrossChainData -> LockProxy -> managerProxyContractforLockProxy

  • 0xc8a65fadf0e0ddaf421f28feab69bf6e2e589963: Attacker
  • 0x838bf9e95cb12dd76a54c9f9d2e3082eaf928270: EthCrossChainManager
  • 0xcf2afe102057ba5c16f899271045a0a37fcb10f2: EthCrossChainData
  • 0x250e76987d838a75310c34bf422ea9f1ac4cc906: LockProxy
  • 0x5a51e2ebf8d136926b9ca7b59b60464e7c44d2eb: managerProxyContract for LockProxy

Function Signatures:

  • d450e04c (verifyHeaderAndExecuteTx)
  • 69d48074 (getCurEpochConPubKeyBytes)
  • 5ac40790 (getCurEpochStartHeight)
  • 0586763c (checkIfFromChainTxExist)
  • e90bfdcf (markFromChainTxExist(uint64,bytes32))

The main process of the attack

The main process of the attack is that the attacker passed the signed data to the function verifyHeaderAndExecuteTx(). This function will decode the data and verify the signatures that are used to sign the data. If this process passes, the method (and the contract address) specified in the message will be executed. During this attack, the unlock function of the smart contract 0x250e76987d838a75310c34bf422ea9f1ac4cc906 is invoked to transfer the Fei to the attacker.

In summary, the attack is due to the valid parameters passed to the verifyHeaderAndExecuteTx function. And the parameters can pass the signature verification process. After that, the transaction specified in the message will be executed (like the arbitrary command execution in software security.)

To better understand this process, we recover the critical values of the call trace.

Function: verifyHeaderAndExecuteTx:

verifySig

unlock

The variable of managerProxyContract in the LockProxy. It matches the value of the caller address of the unlock function.

Conclusion

From the recovered values, we find that:

  1. The attacker provides a valid signed message to the function verifyHeaderAndExecuteTx
  2. The onlyManagerContract modifier in the LockProxy smart contract is NOT bypassed.

Based on these two observations, we suspect that

  1. The attacker may have the legitimate keys to sign the messages, which indicate the signing keys may have been leaked.

Or

  1. There is a bug in the signing process of the PolyNetwork that has been abused to sign a crafted message.

However, we do not have further offchain data to verify our findings. We hope our analysis can be helpful for further investigation.

Credits: Yufeng Hu, Siwei Wu, Lei Wu, Yajin Zhou @BlockSec

Twitter: https://twitter.com/BlockSecTeam

Sign up for the latest updates
Zcash Orchard Soundness Bug Analysis | BlockSec Weekly
Security Insights

Zcash Orchard Soundness Bug Analysis | BlockSec Weekly

During the week of June 1, 2026, a critical soundness vulnerability was publicly disclosed in Zcash's Orchard shielded pool circuit, caused by a missing equality constraint in the halo2 ECC scalar multiplication gadget that could have enabled undetectable counterfeiting of ZEC within the Orchard pool through double-spending. The vulnerability, which existed for over four years since Orchard's activation in May 2022, was discovered by an AI-assisted security audit and patched through an emergency network upgrade (NU6.2). This single-event report covers the technical root cause (under-constrained ZK circuit relation), the AI-assisted discovery by researcher Taylor Hornby using Anthropic's Opus 4.8 model, the emergency response timeline, and the broader implications for the ZKP ecosystem.

Newsletter - May 2026
Security Insights

Newsletter - May 2026

In May 2026, the DeFi ecosystem experienced three major security incidents. Echo Protocol lost ~$76.7M due to an administrator key compromise that enabled unauthorized minting of unbacked eBTC on Monad, StablR suffered ~$12.8M from a multisig governance breach leading to unauthorized stablecoin issuance, and the Verus-Ethereum Bridge incurred ~$11.7M following a type-validation failure that allowed a crafted supplemental export to be misclassified as a valid primary export.

~$16M Lost: DxSale, SquidRouterModule & More | BlockSec Weekly
Security Insights

~$16M Lost: DxSale, SquidRouterModule & More | BlockSec Weekly

This weekly security report covers 5 notable attack incidents between May 25 and May 31, 2026, with combined losses of approximately $16M across BNB Chain, Ethereum, Base, Arbitrum, and Cosmos. Key incidents include the DxSale token locker exploit ($7.3M) involving three missing state updates compounded by a deployer key compromise, the SquidRouterModule exploit ($3.2M) caused by improper input validation in an Axelar Bridge integration that allowed forged cross-chain messages to drain 86 Safe wallets, and the Gravity Bridge signing key compromise ($5.4M). Other incidents involve a compromised deployer key (Stake DAO, $91K) and a vulnerable off-chain bridge backend (Alephium, $300K).

Best Security Auditor for Web3

Validate design, code, and business logic before launch. Aligned with the highest industry security standards.

BlockSec Audit