Some days ago, the crypto space found out that an exploit occurred, which resulted in around $4.6 million in filecoin being deposited twice on the platform. Binance, which is one of the largest crypto exchanges globally, has revealed the reason behind the unusual act. While many believed that a bug caused the error, Binance explained that the reason behind the filecoin deposits occurring more than once is the wrong use of APIs.
When the incident occurred, many people within the digital asset space were surprised, making the firm explain why the issues occurred. Binance continues to be one of the most used exchanges due to its solid security and the listing of various types of cryptocurrencies.
A double deposit occurred from the Exchange
Experts explained that the error is similar to a double spend, a severe attack on a blockchain. The defect, which is capable of destroying a network, also allows cryptos to be spent twice. On the other hand, the filecoin has a unique function as it helps facilitate a decentralized storage network.
Interestingly, the POW, which is used by numerous cryptocurrencies, and even Bitcoin, is known to prevent such incidents from occurring. But the thing appeared only once through the filecoin network, despite Binance’s error of accepting it two times. This incident led to what the industry calls a double deposit.
The firm behind the decentralized storage creation, Protocol Labs, revealed that it investigated the issue and found no problem with the filecoin network and the remote procedure call. Concerning the issue, one of the companies representatives revealed that no double spend occurred on the blockchain.
This would be a relief for users of the network and for Binance, which might have facilitated the double deposit from its ends. Filecoin shared via Twitter that the team got some reports from Binance regarding the API’s incorrect use for transactions on the network.
Binance reveals that no funds were lost to the issue
Fortunately, the team has confirmed that there is no issue regarding the network nor a bug. It also added that it would work with exchanges to ensure proper use of the network. Binance spoke on the deposit issue and explained that deposits of filecoin tokens were stopped when they noticed the double deposit. The firm also added that the issue occurred due to the API logic’s incorrect use when integrating it to facilitate transfers into the filecoin network.
API stands for application programming interface, and it’s the way software communicates with other software. It helps the network get adequate information while passing data to other software. Binance explained that the incident did not lead to loss of funds, which is great news, especially when looking at a double deposit gravity.
The exchange was able to move fast enough to prevent any more issues with the network. Binance continues to be a favorite in numerous continents as it cuts across many nations and is known to be one of the most prominent crypto-based institutions.
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