| Recurring |
one_organization, multiple_organization |
(a) The software failure incident at Beanstalk, where a hacker exploited a flaw in the software's design to steal over $180 million from users, is an example of a software failure incident happening within the same organization [132607].
(b) The articles also mention other incidents in the crypto industry where similar software failures have occurred at different organizations. For example, in August, thieves exploited a coding issue to drain $190 million from a company called Nomad, and the crypto firm Wintermute reported losses of $160 million due to a hack in their DeFi division [132607]. Additionally, in March, a group sponsored by the North Korean government stole $620 million in digital currency from the Ronin Network, and a hacker exploited a software flaw in a DeFi project called Wormhole to abscond with $320 million [132607]. These incidents highlight how software failures have occurred at multiple organizations within the crypto industry. |
| Phase (Design/Operation) |
design, operation |
(a) The software failure incident related to the design phase can be attributed to a flaw in the design of the Beanstalk software platform. The incident occurred when a hacker exploited a flaw in Beanstalk's design to steal over $180 million from users [132607]. This flaw in the design allowed the hacker to take control of the software's governance and transfer the funds out of the system, leading to panic among users.
(b) The software failure incident related to the operation phase can be seen in the misuse of flash loans in the DeFi ecosystem. In the case of Beanstalk, a hacker borrowed $1 billion of cryptocurrency from another DeFi project using a flash loan, which was a lightning-fast process that exploited the lack of a mechanism in Beanstalk's code to prevent such misuse. This misuse of flash loans allowed the hacker to claim control of the Beanstalk DAO and transfer users' funds out of the system [132607]. |
| Boundary (Internal/External) |
within_system, outside_system |
(a) within_system: The software failure incident involving Beanstalk was primarily due to contributing factors that originated from within the system. The collapse of Beanstalk was caused by a hacker exploiting a flaw in the software's design, allowing them to steal over $180 million from users [132607]. The incident was a result of vulnerabilities in the code of the DeFi platform, particularly in the smart contracts that powered it. The lack of mechanisms to prevent certain types of transactions, such as flash loans, led to the hacker taking control of the platform's governance and transferring users' funds out of the system [132607].
(b) outside_system: Additionally, external factors such as the rapid proliferation of DeFi start-ups and the overall lack of regulation in the industry contributed to the software failure incident. The DeFi ventures, including Beanstalk, operated in a loosely regulated environment, allowing for transactions to occur without traditional financial intermediaries like banks or brokers [132607]. This lack of external oversight and the experimental nature of the DeFi sector made it a target for hackers looking to exploit vulnerabilities in the software. |
| Nature (Human/Non-human) |
non-human_actions, human_actions |
(a) The software failure incident in Article 132607 occurred due to non-human actions, specifically a hacker exploiting a flaw in the design of the Beanstalk software platform to steal over $180 million from users [132607]. The hacker used a flash loan to take over the platform's governance, transferring the funds out of the system, leading to panic among users [132607].
(b) Additionally, human actions played a role in the failure as the founders of Beanstalk, including Ben Weintraub, Brendan Sanderson, and Michael Montoya, kept their identities secret and designed the software without a mechanism to prevent a flash loan attack, ultimately allowing the hacker to exploit the vulnerability [132607]. The founders' decision to continue the project after the attack and their efforts to restart it with enhanced security measures also reflect human actions in response to the failure [132607]. |
| Dimension (Hardware/Software) |
software |
(a) The software failure incident related to hardware:
- The incident involving Beanstalk collapsing and losing over $180 million was primarily due to a hacker exploiting a flaw in the software's design, rather than a hardware-related issue [132607].
(b) The software failure incident related to software:
- The collapse of Beanstalk and the subsequent theft of funds totaling nearly $200 million was a result of a hacker exploiting a flaw in the software's design. The software platform Beanstalk had vulnerabilities in its code that allowed the hacker to take control of the governance system and transfer users' funds out of the system [132607]. |
| Objective (Malicious/Non-malicious) |
malicious, non-malicious |
(a) The software failure incident related to the Beanstalk platform was malicious in nature. The incident involved a hacker exploiting a flaw in Beanstalk's design to steal over $180 million from users [132607]. The hacker used a flash loan to take over the platform and transfer everyone's funds out of the system, leading to panic among users [132607]. There were suspicions among users that the founders of Beanstalk were behind the attack, leading to a situation where it "felt like death" for the founders [132607].
(b) The software failure incident was also non-malicious in the sense that the vulnerabilities in the software code, particularly in the smart contracts that powered DeFi, were unintentional. Many of the thefts in the DeFi sector this year were due to flaws in the computer programs (smart contracts) that were built hastily and on faulty code [132607]. The incident highlighted the risks associated with the rapid proliferation of DeFi start-ups and the pressure it put on the space, restricting the innovation that was possible [132607]. |
| Intent (Poor/Accidental Decisions) |
poor_decisions |
(a) The software failure incident related to the Beanstalk platform collapse was primarily due to poor decisions made during the development and design of the software. The founders of Beanstalk, including Ben Weintraub, Brendan Sanderson, and Michael Montoya, designed the platform with vulnerabilities that allowed a hacker to exploit a flaw in the software's design and steal over $180 million from users [132607]. The code lacked mechanisms to prevent a hacker from using a flash loan to take control of the platform, leading to the theft of funds and the collapse of Beanstalk. This incident highlights how poor decisions in software development, such as overlooking security vulnerabilities, can have severe consequences in the cryptocurrency industry. |
| Capability (Incompetence/Accidental) |
development_incompetence, accidental |
(a) The software failure incident related to development incompetence is evident in the case of Beanstalk, a DeFi platform developed by Ben Weintraub and his classmates. The platform collapsed after a hacker exploited a flaw in its design, leading to the theft of over $180 million from users [132607]. The incident highlighted the risks associated with hastily built DeFi projects that may contain faulty code, making them vulnerable to attacks. The lack of robust security measures and vulnerabilities in the software code contributed to the massive theft, showcasing the consequences of development incompetence in the crypto industry.
(b) The accidental nature of the software failure incident is also apparent in the case of Beanstalk. The founders, including Ben Weintraub, did not anticipate the rapid rise of their platform and its subsequent vulnerability to hacking attacks. The flaw in the software design that allowed the hacker to exploit the system and steal funds was not intentional but rather a consequence of overlooking potential security risks during development [132607]. The incident serves as a reminder of how accidental oversights or negligence in software development can lead to significant financial losses and reputational damage. |
| Duration |
permanent |
(a) The software failure incident related to the Beanstalk platform was more of a permanent failure. The incident occurred when a hacker exploited a flaw in Beanstalk's design, leading to the theft of over $180 million from users [132607]. This theft resulted in panic among users, with one user declaring a loss of $1 million through the platform [132607]. The incident was significant enough to cause the collapse of Beanstalk, leading to its demise [132607].
(b) However, it's worth noting that the founders of Beanstalk decided to continue the project after the theft incident. They reported the theft to the FBI, revealed their identities, and took steps to restart the project by recruiting blockchain analysis firms and security firms to review the code for vulnerabilities [132607]. This indicates that while the initial software failure incident was severe and had permanent consequences, efforts were made to address the issues and potentially recover from the incident. |
| Behaviour |
crash, omission, value, other |
(a) crash: The software failure incident involving Beanstalk can be categorized as a crash. The incident resulted in the collapse of the Beanstalk platform after a hacker exploited a flaw in its design, leading to the theft of over $180 million from users [132607].
(b) omission: The software failure incident can also be linked to omission. The code designed by the founders of Beanstalk did not include a mechanism to prevent a hacker from using a flash loan to take over the platform, resulting in the hacker gaining control of the software's governance and transferring funds out of the system [132607].
(c) timing: The timing of the software failure incident is not explicitly mentioned in the article. However, the incident occurred in April when a hacker exploited a flaw in Beanstalk's design, leading to the collapse of the platform [132607].
(d) value: The software failure incident can be associated with a failure in value. The incident involved the theft of over $180 million from users of the Beanstalk platform due to a flaw in its design, which allowed the hacker to exploit the system and transfer funds out of it [132607].
(e) byzantine: The software failure incident does not align with a byzantine failure, which involves inconsistent responses and interactions. The incident with Beanstalk was more focused on a specific flaw in the software design that was exploited by a hacker to steal funds, rather than exhibiting inconsistent behavior [132607].
(f) other: The software failure incident can be categorized as a security breach leading to a significant financial loss. The incident highlighted vulnerabilities in the DeFi software, particularly in the smart contracts powering the projects, which allowed hackers to orchestrate attacks on the digital infrastructure and steal funds from users [132607]. |