This article explores how Sign works, its flagship products (such as TokenTable, SignPass and EthSign), its native token (SIGN) and how to trade SIGN on Bybit.

Sign is an omnichain attestation infrastructure that empowers users and developers to verify real-world claims on-chain. Built for a more transparent and decentralized future, it eliminates the need to “just trust” and enables everyone to verify with cryptographic proof.

This article explores how Sign works, its flagship products (such as TokenTable and EthSign), its native token (SIGN) and how to trade SIGN on Bybit.

 is an omnichain attestation protocol designed to make it easy for anyone to verify the authenticity of any claim — 

. Whether it’s a document, credential or user identity, Sign transforms traditional trust models into verifiable, cryptographic attestations. 

Sign’s mission is to replace outdated, opaque validation systems with transparent, 

 proof — enabling a future where “verify” replaces “trust.” Through tools like schema registries and digital signatures, Sign empowers users to bring accountability and integrity to digital interactions.

Sign is developed by the team behind EthSign, a 

-native e-signature and agreement platform. Its core team brings deep experience in 

 development and cross-chain integrations.

The project is backed by top-tier investors, including Sequoia Capital China (now known as HongShan Capital Group), Mirana Ventures, HashKey Capital and Hack VC.

This strategic funding positions Sign as a foundational layer in the web3 infrastructure stack.

Sign allows users to create attestations — cryptographically signed statements that prove the validity of claims, such as credentials, achievements or actions. These digital proofs can be verified by anyone at any time, making them tamperproof and transparent.

Sign’s key technical elements include a schema registry that ensures consistent data formatting, digital signatures proving authenticity, and on- and off-chain attestations with support for revocation or updates

This system acts like a programmable layer for web3, bringing a new level of trust to identity, credentials and data exchange.

TokenTable is Sign’s flagship token distribution platform. It helps projects unlock, distribute and manage tokens transparently and securely at scale.

It uses Sign’s attestation engine to verify token unlocks, 

 and vesting schedules, ensuring traceable, auditable token flows.

SignPass is a blockchain-based identity solution that brings real-world credentials on-chain. One notable implementation is the Sierra Leone PR Card, used for the world’s first government-approved on-chain permanent residency program.

SignPass offers encrypted on-chain records for easy 

 verification, physical ID issuance for daily identity use and streamlined digital application systems for cross-border access.

It showcases the way blockchain can modernize public sector services worldwide.

EthSign is a decentralized contract signing platform that lets users create, sign and store legally binding agreements directly on-chain. It removes intermediaries and ensures documents are immutable and accessible.

EthSign reinforces Sign’s mission by bringing traditional documentation into the realm of verifiable web3 attestations.

The SIGN token is the native utility token powering the Sign ecosystem. It’s used for:

The total supply is capped at 10 billion SIGN, with 1.2 billion tokens in circulation. While the fully diluted valuation (FDV) sits above $746 million as of May 7, the circulating market cap is approximately $89.6 million. SIGN continues to gain traction across exchanges and developer networks.

SIGN is available for trading on Bybit via Spot trading and as a USDT Perpetual contract. Bybit offers up to 75x leverage for the SIGNUSDT Perpetual contract and supports secure, high-liquidity spot trading.

Start exploring the future of attestations with SIGN on Bybit today.

Intermediate

sign.png

Sign (SIGN): Web3 protocol for trustless attestation

Compliant trading means following platform rules and avoiding manipulative behavior. Learn more about how you can trade responsibly and compliantly on Bybit.

Crypto trading has come a long way from what used to be the domain of institutional players, and is now open to almost anyone with an internet connection. It’s easier than ever to buy and sell digital assets, try new strategies or build a portfolio from scratch all within minutes.

But with that level of access comes responsibility. As more people join the market, the need for fairness and accountability has become even more important. This isn’t just about price charts or profits — it’s about keeping the playing field level for everyone involved.

At Bybit, we take that responsibility seriously. We're here to offer the tools, safeguards and education you need to help you trade responsibly and to protect the platform from misuse.

This article describes what it actually means to trade compliantly, why it matters — and what can happen if things go off course.

Compliant trading means playing fair, following the platform’s rules, staying within the boundaries of what’s allowed and avoiding anything that could unfairly affect the market.

It’s not about avoiding risk: it’s about knowing what you’re doing, using official tools the right way and making sure your trades aren’t causing harm to yourself or others.

In short, compliant traders don’t just focus on their P&L — they understand that how they conduct themselves while trading matters. Responsible trading protects their accounts, keeps the platform stable and builds long-term credibility in the crypto ecosystem.

Why does responsible and compliant trading matter?

It’s easy to assume that compliance is only something platforms or regulators need to worry about. But in reality, every trader plays a part. When someone attempts to exploit the system — for example, by coordinating mass trades through off-platform channels — the consequences can ripple across the entire market.

In extreme cases, irresponsible trading behavior can:

And if the trades in question are linked to coordinated action, use of fake accounts or external bots? That opens the door to account freezes, compliance reviews and, in some cases, permanent suspension.

Bybit has a responsibility to act when the system is being abused — not just for legal reasons, but in order to protect honest traders.

Common examples of noncompliant or risky behavior

Some traders join Telegram groups or online communities in which KOLs (key opinion leaders) give out coordinated trading instructions (for example, “Buy token A now, sell it in an hour”). This practice isn’t just risky: it often involves a small number of insiders benefiting while the majority end up with losses.

When many people follow the same instruction all at once, it can artificially inflate the price of a low-liquidity token. The KOLs then exit at the top —while others are left with falling prices and unexpected liquidations.

Such a textbook case of market manipulation violates our Terms of Service and, depending upon jurisdiction, could violate financial laws.

Using bots or unverified trading strategies

Some Telegram groups may seem convincing, but trades coordinated off-platform are often unverified and may serve someone else’s agenda. 

 programmed to front-run trades, mimic pump-and-dump strategies or follow unverified signals can trigger compliance red flags and may lead to account restrictions.

Bybit does not support trading bots from unverified sources. They can also trigger flags in our monitoring systems, which may result in account suspension.

Using another person’s account or sharing login credentials — even if it’s with a family member — goes against both Bybit’s policies and global 

(AML) rules. It also opens the door to fraud, loss of funds and irreversible penalties.

Tips for responsible and compliant trading on Bybit

The good news is that there’s a better way to trade — responsibly, safely and with confidence, starting with the right tools, mindset and habits.

Use copy trading the way it’s meant to be used

 is one of Bybit’s most trusted features, and for good reason. It gives users access to professional traders’ strategies while maintaining full transparency. However, it only works if you follow verified 

These traders have been vetted and their stats are fully visible. You can view their P&L, risk settings and trade history. Bybit also provides built-in tools, such as 

 and staking products allow you to earn passive yield with minimal effort. These products are fully backed by our infrastructure and undergo regular audits, and are a compliant way to generate returns without chasing risky trades.

No matter how convincing a Telegram group may sound, remember that trades executed outside of regulated channels are unverified and often unaccountable. They may be coordinated for someone else’s gain.

 offers a wide range of articles and tutorials, covering everything from indicators and oscillators to advanced portfolio strategies. Before following any external signal, it’s worth spending 10 minutes to understand the rationale behind it. In trading, knowledge is your best form of compliance. Before you enter any position, ensure that you fully understand the asset you're trading, the current market conditions and the risks involved.

, never share your login credentials, and always enable two-factor (2FA) authentication. In addition, all trading activity should originate from your own account and remain under your own control.

Bybit’s systems are designed to flag irregular behavior. If your account is found to be engaging in prohibited activity, even unintentionally, you may be:

We take these steps in order to protect the broader user base and to uphold market fairness.

Being compliant doesn’t mean missing out on opportunity. In fact, it’s the opposite. It means you’re using the platform the way it was designed, with safeguards, transparency and trust. Shortcuts might look appealing in the short term, but they rarely end well. The most successful traders on Bybit are the ones who understand risk, stay informed and trade with integrity.

Take the time to learn and use the tools available to you. And remember: protecting your account starts with choosing how you’ll trade.

Beginner

compliant trading.png

How to trade compliantly and responsibly on Bybit

Discover how DAI evolved into USDS under the Sky protocol—unlocking passive rewards, scalability, and a new era of DeFi with Sky Token Rewards.

In September 2024, MakerDAO, a pioneering 

 (DeFi) protocol, underwent a significant transformation by rebranding itself as 

 (SKY). This rebranding was part of the project's comprehensive strategy to enhance scalability, user engagement and regulatory compliance. The major changes that came with the rebranding include token upgrades, whereby the platform’s stablecoin, Dai, was upgraded to USDS (Sky Dollar) while the 

Let’s take a deeper look at USDS and its role on the Sky platform.

USDS (United States Dollar Sky) is the upgraded version of the Dai stablecoin, launched under the newly rebranded Sky protocol (formerly MakerDAO).

 Like DAI, USDS is a decentralized, overcollateralized stablecoin designed to maintain a 1:1 peg with the US dollar.

However, USDS significantly improves scalability, user incentives and regulatory positioning, making it a next-generation solution for DeFi.

One of the standout features of USDS as a stablecoin is that it creates 

 opportunities for its investors. With USDS, you can access the Sky Savings Rate (SSR) feature, which allows you to participate in the Sky ecosystem's governance by accumulating Sky Token Rewards (STR) (presented in the form of SKY tokens).

SSR also features a variable automated token accumulation feature, whereby you receive 

 to the SSR program. This passive earning potential offers a major advantage for users seeking yield without complicated 

Sky uses a dynamic model that adds USDS to the SSR pool every few seconds. Over time, the value of sUSDS in the particular pool increases. You can then opt to redeem your sUSDS for USDS, and receive the USDS you initially supplied in addition to the USDS equivalent you’ve accumulated.

These rewards serve as an incentive mechanism, enabling users to passively grow their holdings while supporting the health and stability of the Sky ecosystem.

Upgrading from DAI to USDS is straightforward. Users can visit Sky.money and initiate the upgrade directly through a noncustodial, user-controlled process.

The platform provides a simple interface on which users connect their wallets, exchange their existing DAI for an equal amount of USDS and instantly become eligible for yield accumulation and other Sky ecosystem benefits. There are no fees for the upgrade, and users retain full control of their assets at all times.

USDS isn’t just a stablecoin; it’s an evolution of DeFi money. With passive earning through Sky Token Rewards and a smooth, secure upgrade path, USDS sets a new standard for the way decentralized stablecoins can deliver value and financial empowerment to users worldwide.

USDS and DAI are both decentralized stablecoins originally developed under the MakerDAO ecosystem (now Sky). While they share the same core principle — overcollateralization and the maintenance of a 1:1 peg with the US dollar — USDS represents a major evolution of DAI, introducing additional incentives designed to enhance user experience, scalability and regulatory alignment.

DAI has long been a favorite in the DeFi ecosystem, allowing users to generate stablecoins by locking up crypto collateral such as 

. DAI features a savings program, the DAI Savings Rate (DSR), from which people can earn 

 (sDAI). While the DSR program is still running, upgrading to USDS lets you earn two types of rewards through the SSR program: sUSDS tokens and Sky Token Rewards (STRs).

In addition, USDS is well positioned to meet regulatory requirements, aiming for broader mainstream adoption while maintaining decentralization.

Below is a comparison table between DAI and USDS:

USDS is backed by collateral that’s deposited in Sky vaults by borrowers. In return, the reserves for these vaults are backed by three main assets: 

With a market cap of over $8 billion, USDS is the currently third-largest stablecoin after 

 is more complex than that of typical stablecoins, as it includes liquidation mechanisms and a peg-stability module. However, an audit of USDS’s smart contract in September 2024 didn’t report any significant risks with the stablecoin. Notably, S&P Global Ratings 

 of 4 out of 5, indicating constrained ability to maintain its peg under certain conditions. 

​Additionally, the proposal to include a freeze function for USDS, which bestows upon the Sky protocol the power to halt USDS transfers between wallets, has sparked heated discussions within the community, highlighting the ongoing conundrum of balancing security measures with principles of decentralization.

The evolution of DAI to USDS marks a major leap forward for DeFi. By combining DAI's trusted and overcollateralized model with additional passive earning opportunities through Sky Token Rewards, USDS empowers users to enjoy greater financial benefits with less complexity.

The streamlined upgrade process and stronger regulatory positioning set the stage for broader adoption and a more resilient future. As Sky continues to build, USDS represents more than just a stablecoin — it’s the foundation of an open, accessible and more rewarding financial ecosystem for everyone.

usds crypto.png

From DAI to USDS: Unlocking an open Sky for a more rewarding future

Vietnam is establishing a crypto regulatory sandbox and legal framework to bring clarity, security and oversight to its fast-growing digital asset market.

With a tech-savvy population and high rates of crypto adoption, Vietnam is a hotbed of crypto activity. About 17 million of the population own digital assets, as blockchain market flows into Vietnam reached $105 billion from 2023–2024, 

. However, the absence of a clear legal framework has posed challenges for investors, businesses and regulators. Recognizing the need for structured oversight, the Vietnamese government has initiated decisive steps to establish comprehensive regulations for the crypto sector. 

This article delves into Vietnam's current stance on cryptocurrencies, its implementation of a regulatory sandbox, collaborative efforts with industry leaders like Bybit — and the broader implications for traders and the crypto industry.

Vietnam currently lacks a formal legal framework that specifically addresses cryptocurrencies and digital assets. As a result, these digital currencies operate in a regulatory gray zone — neither fully legal nor banned. Existing financial laws only recognize electronic money tied directly to fiat currencies, such as prepaid bank cards and e-wallets, leaving cryptocurrencies like 

This lack of legal clarity has pushed many crypto-related businesses to register in jurisdictions with clearer regulations, such as Singapore and the United States, before operating within Vietnam. A workaround that has led to the loss of potential tax revenue has weakened the competitiveness of Vietnam’s domestic market in the growing digital economy.

Still, despite this uncertainty, Vietnam ranks among the top countries globally for crypto ownership and trading volume, and the stark contrast between widespread adoption and the absence of clear regulations points to the urgent need for a comprehensive legal framework. Recognizing this, the Vietnamese government has begun drafting new regulations to bring clarity and oversight to the digital asset space.

A regulatory sandbox is a controlled environment that allows financial technology innovations to be tested in real-world conditions for a limited time under the watchful eye of regulators. It provides a safe space in which to experiment with new products and services, while ensuring that consumer protection and market stability remain a priority.

How does Vietnam’s regulatory sandbox initiative work?

Vietnam’s regulatory sandbox is designed as a safe, controlled space in which financial technology innovations — including those involving digital assets and cryptocurrencies — can be tested under regulatory supervision. It operates under a multi-agency governance structure, with the 

This committee is responsible for licensing participants, supervising operations, assessing potential risks and ensuring the overall stability of the fintech ecosystem. It works closely with the State Bank of Vietnam (SBV), which was officially assigned to develop the sandbox under newly minted 

, as well as other key agencies like the Ministry of Finance and the Ministry of Public Security.

. The Ministry of Finance is responsible for developing legal guidelines and licensing service providers, while the Ministry of Public Security focuses on combating fraud, money laundering and other criminal activities within the digital asset market. Lastly, the State Bank of Vietnam monitors the impact of digital assets on the country’s monetary policy and overall financial system.

, businesses must undergo a formal assessment process. Eligible participants include credit institutions, independent fintech startups or fintech firms partnering with banks. After passing initial evaluations by the SBV, approved entities receive a registration certificate signed by the prime minister. These businesses then enter a testing phase lasting one to two years that allows regulators to observe how the businesses’ operations function in a live but supervised environment.

 preventing money laundering, managing digital asset transactions, regulating crypto mining activities and establishing oversight for the issuance, ownership and trading of 

. This initiative will roll out gradually, starting with the launch of financial centers in Ho Chi Minh City and Da Nang in 2025. 

 using crypto assets are expected to begin by Jul 1, 2026. 

How Bybit is supporting Vietnam in its path toward regulatory clarity

Bybit is closely collaborating with the Vietnamese government, particularly the Ministry of Finance, to contribute to the development of a regulatory sandbox. This controlled testing environment allows new crypto regulations to be explored and fine-tuned before being rolled out nationwide. During the 

, Nguyen Van Thang, Bybit CEO Ben Zhou emphasized the importance of building a secure, transparent and innovation-friendly crypto ecosystem that protects investors and upholds market integrity.

 is its technical support for Vietnam’s pilot crypto trading platform, which is operating within the sandbox framework. This initiative enables regulators to safely observe real-time crypto transactions and better understand market behavior. Bybit brings its deep expertise in areas like system architecture, transaction monitoring and the implementation of robust compliance tools, such as 

 (KYC) protocols — essential elements for ensuring digital assets aren’t misused, and that regulatory standards are met.

Enabling Vietnam’s crypto infrastructure

But Bybit’s involvement goes beyond technology. The exchange is also focused on empowering Vietnamese regulators through hands-on training and capacity building. These sessions are designed to equip officials with the skills and knowledge needed to effectively oversee a fast-growing crypto market. The 

 has been tasked with working directly alongside Bybit to explore future steps, a move that reflects the Vietnamese government’s confidence in Bybit’s global track record and regulatory experience.

While mainly focused on compliance, this collaboration is also a forward-looking partnership aimed at creating a balanced regulatory environment that nurtures innovation while ensuring financial stability. Bybit is helping Vietnam lay the foundation for a legal framework that can adapt to the rapid evolution of crypto technology. In doing so, the country is firmly positioning itself as a leader in the digital economy.

Why this matters for crypto traders and the industry

Vietnam’s move to establish a crypto regulatory sandbox (and eventually, a full legal framework) means greater security and peace of mind for individual investors and traders. The sandbox enforces strict KYC and AML protocols, reducing the risk of 

. With clear rules expected by May 2025, traders will finally have legal certainty, allowing them to operate confidently without fear of running afoul of unclear or outdated regulations.

For the crypto industry, the sandbox offers a rare opportunity to test new products and services under the watchful eye of regulators without immediately facing the full weight of compliance laws. This creates room for innovation that will help exchanges, token issuers and startups build trust and scale faster. The government’s support for building financial centers in cities like Ho Chi Minh City and Da Nang adds momentum, turning Vietnam into a potential regional hub for crypto businesses and investors.

As the framework takes shape, clearer licensing and operational guidelines will enable crypto platforms to run with greater transparency and reliability, boosting confidence for both institutional players and everyday users. Integration with national data systems will also strengthen transaction monitoring, and reduce risks related to energy-heavy mining operations or illicit activity. With major industry players like Bybit helping to realize this vision, Vietnam is laying the groundwork for a secure and innovation-friendly market.

Ultimately, this regulatory shift benefits everyone: Traders get protection and clarity, and industry players gain a supportive environment in which to grow. Vietnam will be positioning itself as a forward-looking nation that’s ready to welcome the future of finance, attracting foreign investment, driving adoption and unlocking new revenue streams to support economic growth.

Vietnam is taking bold steps toward regulating its crypto market through a structured regulatory sandbox and partnerships with industry leaders like Bybit. These efforts aim to create legal clarity, protect investors and encourage innovation. For traders and businesses alike this marks a turning point, ushering in a safer, more transparent and opportunity-rich environment as Vietnam embraces an alpha role in the global digital economy.

vietnam crypto regulations.png

Crypto regulations in Vietnam: A path toward regulatory clarity

Bybit Learn

DeFi

Fearful of the Acala DeFi hack and aUSD depegging? Here's how the team is planning to resuming operations after the aUSD crypto-backed stablecoin crashed 99%.

bybit-register-page-regular-cta.jpg

 DeFi platform known as Acala was depegged by more than 99% because of a hacker. The team behind Acala was forced to place a pause on the hacker's wallet, which caused concerns for many Acala crypto investors about how decentralized the platform actually is. The Acala DeFi hack was among the most notable hacks in the crypto industry during 2022. If you're an Acala crypto user, you’ll want to understand what the Acala DeFi attack entailed, and what it means for the Acala network over the coming months.

Acala is a Polkadot DeFi platform that offers modular financial services, and comes with a liquidity hub that's designed specifically to support Polkadot DeFi. It brings borrowing, lending and stablecoin functionality to the broader Polkadot ecosystem.

. Since the Acala network was the very first DeFi protocol to be launched with Polkadot parachain auctions, it's considered to be the Polkadot DeFi hub. Being 

, developers can easily port over their projects from Ethereum to the Acala network. This means it can potentially become the DeFi hub for practically all cryptocurrencies.

 a governance token known as ACA and a native decentralized stablecoin known as aUSD. The ACA token is also used to pay for any transaction fees. Along with ACA, there are a wide range of additional tokens that are allowed for transaction fee payments on the Acala network.

Founded by the Acala Foundation, Acala is essentially an in-depth collaboration between two development groups with Polkadot DeFi, known as Polkawallet and Laminar. The foundation has strived to develop DeFi markets across different blockchains that were connected by the 

. In order to reach this goal, the Acala network was created as a community-owned and -operated financial layer that uses Polkadot's Substrate framework. While Acala includes financial application features, their main area of focus is improving development capabilities and interoperability initiatives.

Development on the Acala network first began in 2019 when the Web3 Foundation provided Acala with a development grant. Since that time, the Acala network has obtained additional funding from crypto investment firms Pantera Capital and Polychain Capital. These private fundings raised more than $8 million by August 2020, and the Acala network was formally launched on Polkadot in  late 2021.

 (DEX), a liquidity staking protocol and a stablecoin, which makes it a well-rounded crypto project that's part of the Polkadot DeFi initiative. Since the Acala network is fully compatible with EVM, it has a considerable amount of utility for Acala crypto investors.

When using this platform, you'll gain access to DApps, crypto assets and DOT-based derivatives. At the moment, the Acala network is made up of three parts: AcalaSwap, Honzon and Homa.

 is an automated market maker (AMM) that’s based on a standard swap interface, which gives you the ability to trade various crypto assets in liquidity pools. Any liquidity providers can earn fees for placing Acala crypto into the pools. While the Acala DEX uses a very familiar structure, there's no need for it to completely change things up when it comes to decentralized trading.

On the other hand, a new feature that's possible through the Acala network DEX is the ability to natively trade between different cryptocurrencies, across any blockchains that are connected to Polkadot. Note that both Polkadot and Polkadot’s canary network Kusama are already widely adopted. In fact, popular projects announce that they want to join Polkadot via parachains on a regular basis. Therefore, it's believed that the amount of cross-chain liquidity available through the Acala DEX will always hold up.

One notable difference between the Acala network DEX and all other Ethereum-based DEX platforms is that the Acala DEX is much more affordable to use. Polkadot is known as a high-throughput blockchain, which allows for micro–gas fees. These fees can be paid with Acala crypto and a wide range of additional cryptocurrencies.

 is the stablecoin protocol that's used with the Acala crypto network. Acala has taken advantage of its reputation as a cross-chain interoperability network by developing its own aUSD stablecoin, an 

 that’s been 1:1 pegged with USD. However, it's also backed completely by other crypto collateral.

The aUSD stablecoin platform works because of the Honzon protocol, which was created for minting stablecoins whenever these coins are deposited by crypto users as collateral. Upon the launching of this protocol, the aUSD stablecoin platform was able to accept ETH, BTC and DOT as collateral. It's believed that additional currencies will eventually be supported by parachains.

The aUSD stablecoin is easy to understand. Once collateral from Acala crypto (or a wide range of other currencies) is deposited, aUSD is officially minted, after which you can open a collateral debt position. Taking on this position means that you owe money directly to the protocol, which must be repaid along with a certain amount of interest at a later date.

Once you've repaid your collateral debt position, the protocol mentioned previously will burn the same amount of aUSD stablecoin, which reduces the amount of aUSD stablecoin that's currently circulating. This process allows the aUSD stablecoin to maintain its USD peg. If you're considering investing in the aUSD stablecoin, it’s important to know that Honzon comes with enhanced stability and security.

The Polkadot DeFi ecosystem centers on bonding assets. "Bonding" involves a process that's similar to staking. During the bonding process, your tokens are locked with a smart contract for a certain amount of utility. In return for bonding your Acala crypto tokens, you'll receive interest.

Before the development of decentralized finance, it was difficult to find platforms that used staked assets. When these assets did exist, they couldn't be used for liquidity. Now that staked derivative assets have been created, crypto platforms can access staked liquidity.

The Acala network takes this one step further by providing DOT holders with 

. Also referred to as Liquid DOT, LDOT is a type of token that’s used to represent your staked liquidity. Your LDOT can be removed from the Homa protocol before being used as aUSD stablecoin collateral through Honzon.

Acala provides developers, projects and investors that have DOT crowd loans with the ability to compound their entire crypto capital, without needing to place DOT tokens directly on the market. The protocol is designed this way to resolve the illiquidity issues that come with staked DOT tokens.

While Acala doesn't necessarily revolutionize DeFi, it does have some unique aspects that differentiate it from other DeFi hubs. First of all, the Acala crypto network focuses on collaboration through its cross-chain DeFi infrastructure, which makes it beneficial for the entire industry. Investors can take out loans and fully collateralize them with crypto that comes from other blockchains. You can also use the AMM to swap cryptos without needing to wrap them beforehand, which simplifies the entire process.

If you've previously invested in the Polkadot platform, the Acala crypto network has essentially facilitated a Polkadot DeFi platform. The most modern and advanced DeFi features are supported with Acala. If you hold the Acala crypto token, you have the ability to obtain passive returns with it specifically. The returns you obtain are based on the number of tokens you stake. All of your staking rewards are paid with ACA.

Despite Acala’s ample security features, as well as those of the entire Polkadot DeFi platform, an Acala DeFi hack occurred on August 14, 2022, resulting in a large portion of aUSD stablecoin being minted. In turn, aUSD lost around 99% of its value, which is why the Acala DeFi hack is among the most severe crypto attacks to have occurred in years. The exploit experienced by the Acala network was so strong that it caused aUSD’s price to drop to practically zero. Before, it was effectively pegged 1:1 with the U.S. dollar.

The team at Acala quickly determined that the Acala DeFi hack resulted from a misconfiguration of the aUSD/

 liquidity pool, which had gone live just earlier that day. This issue resulted in a minting error with a sizable amount of aUSD. One hacker involved with the Acala DeFi hack was able to mint around $1.28 billion in aUSD, which was swapped for a much smaller amount of the ACA token.

Shortly after the Acala DeFi hack began, Acala placed the parachain into maintenance mode, which paused all swaps. Oracle price feeds and cross-chain transactions were also paused, which resulted in the hacker being effectively stranded with $1.28 billion in aUSD tokens that were no longer worth anything.

A few additional users mimicked the initial hack to mint anywhere from $25,000 to $80 million in aUSD. The total sum of stolen funds is less than $10 million when not taking the aUSD depeg into account. After the Acala DeFi hack, many crypto investors began to raise questions about the Acala network’s viability.

Since the breach of the Acala network in mid-August, the team has managed to recover around 3 billion aUSD to help push the value closer to the 1:1 USD peg. During the second trace, following the Acala DeFi hack, they were able to recover around 1.68 billion aUSD. The first trace allowed for the recovery of 1.29 billion aUSD. Additional trace reports are expected to occur in the weeks to come, which may lessen the severity of the Acala DeFi hack.

While the Acala DeFi hack was severe, the team at Acala was able to quickly freeze all services, which effectively lessened the impact caused by the hack. Around 16 separate users who contributed to aUSD liquidity pools received aUSD that was minted during the Acala DeFi hack. Along with the trace reports, Acala will publish a postmortem. While aUSD was initially valued at around $0.01 after the Acala DeFi hack, it's now valued at around $0.85 because of recent recovery efforts.

As the Acala platform token, ACA has been allocated for rewards, strategic investors, the Acala team, further ecosystem development and a certain amount of reserves. By the end of 2026, more than $800 million of ACA will be distributed. The amount that's distributed to crowd loan participants, strategic partners and the Acala team will grow over time.

ACA is currently priced at $0.235 and has a circulating supply of more than 508 million tokens. The market cap is right around $120 million. Acala aims to soon release a final trace report that goes into more detail about the recent DeFi hack, which can be verified by the community with on-chain data. Proposals will then be formulated by re-collateralizing aUSD. The community will be able to make decisions and formulate service resumption plans.

The Acala DeFi hack was immediately damaging to the value of aUSD. While steps have been taken by the Acala team to remedy this issue, the extent and severity of the hack means that you should take some time to determine if Acala is a good investment for your portfolio.

While the hack has put a pause on the Acala team's road map, the map is still ambitious and may eventually be able to help crypto investors gain confidence in the platform. For instance, Acala eventually wants to enable balance transfers and is working to further invest in ecosystem development over the next few years.

Before investing, consider focusing on what the Acala team says about additional steps they'll take to resolve the issues caused by the Acala DeFi hack. If they correct these problems, you should be able to invest without worrying too much about your crypto portfolio.

If you’d like to invest in ACA, you can do so on Bybit with Spot trading. All that's required for you to get started is for you to 

From there, you'll notice a search box at the top center of the page. Once you type in "ACA," you'll be shown an 

 Spot trading option. Click on it to be taken to the main ACA page. On the right side of the page, you can enter the amount of ACA you'd like to purchase. Make sure that your wallet is connected to Bybit before you begin.

Despite the severity of the Acala DeFi hack, the team at Acala has taken numerous steps to recover the minted aUSD and stem the issues caused by this hack. However, some crypto investors still distrust Acala because of the belief that the platform isn't as decentralized as it had been advertised to be. Whether you choose to invest in the aUSD stablecoin, or decide to take your crypto assets elsewhere, it's clear that the Acala DeFi hack has caused a considerable amount of damage to the platform's reputation, as well as the value of aUSD.

Acala DeFi Hack: Is aUSD Worth Investing in After the Exploit?

Compete for 2,500 USDT Every Week

Earn Points by Completing Tasks

Event Rules

Register now and get 10 points

Write/Reply Comments (0/5)

Publish an Article (0/5)

Share an Article on Social Media (0/5)

Like an Article (0/5)

Read an Article (0/5)

Weekly Leaderboard