On Jan. 15, Ripple CTO Paolo Ardoino said that someone attempted to attack Bitfinex using a “Partial Payments Exploit.”
However, the attack failed due to the way the exchange handles a data field for the delivered amount, he added.
The clarification follows alerts that a huge $15 billion XRP transfer from an unknown wallet to Bitfinex on Jan. 14 failed to get processed.
— Paolo Ardoino 🍐 (@paoloardoino) January 14, 2024
Ripple Response to Attack
A since-deleted ‘Whale Alert’ tweet claimed observing a transaction of more than 25 billion XRP. This was picked up by analyst Scott Melker, who said, “This cannot be real,” before adding, “The circulating supply of XRP is roughly 54 billion. This is almost half of that. From one wallet. In one transaction.”
However, Whale Alert reported the issue as fixed following an erroneous reading.
🛠️ There was an issue with properly reading the #Ripple node response, resulting in a few wrong posts. We fixed the issue.
— Whale Alert (@whale_alert) January 14, 2024
Partial Payments is an XRP Ledger function that enables payments that deliver less than the amount field indicates. The exploit assumes a company has not configured its XRP payments system and only reads the amount field, which is set very high.
The attacker sends a much smaller amount and aims to pocket the difference automatically credited by the company. If a payment does not enable the Partial Payment flag, the amount field of the transaction in the XRP Ledger specifies the amount to deliver, according to the documentation.
Fortunately, Bitfinex had properly configured their systems to read the delivered amount field and not just the amount field. The attack, if successful, could have been devastating for Ripple and its native token. A similar attack was attempted on Binance, according to blockchain data.
XRP Price Outlook
XRP prices spiked and dumped around 3% at the time of the attempted exploit. However, they have recovered to trade up 2.2% on the day at $0.586 at the time of writing during early trading in Asia on Monday morning.
There has been speculation about a spot XRP ETF, but not enough to bolster sentiment and markets for the asset. Moreover, XRP remains down 83% from its all-time high.