Balancer dips below daily resistance level, eyes April 8 low
BAL, the native token of the Balancer platform, has dropped significantly following a major hack on the platform, losing 12% in 24 hours and falling below $0.9. The exploit resulted in a loss of approximately $110 million in digital assets, including osETH, WETH, and wstETH, due to a faulty access control in the “manageUserBalance” function of its smart contract. The technical indicators suggest a bearish trend, with the RSI in the bearish zone and the MACD signaling negative momentum. If the selloff continues, BAL could test its next major support at $0.735. However, a recovery would require the token to surpass the resistance at $0.915 and move above the $1.0 level.
Decentralized Exchange
BAL Experiences Significant Decline
BAL has dropped 12% within the last 24 hours, falling below the critical $0.9 price point. The coin's value appears to be approaching the April 8 low of $0.739 if the bearish trend continues. This rapid decline reflects its vulnerable market position.
Impact of the Balancer Hack
The bearish trend for BAL, the native token of the Balancer platform, follows a major exploit of the Balancer DeFi protocol. On Monday, the protocol suffered a significant attack, resulting in the loss of approximately $110 million in digital assets, including osETH, WETH, and wstETH. The attacker siphoned off 6,850 osETH, 6,590 WETH, and 4,260 wstETH.
Root Cause of the Exploit
Security researchers from Decurity revealed that the hack was enabled by a vulnerability in the manageUserBalance function, which lacked proper access controls. Specifically, the _validateUserBalanceOp function permitted unauthorized internal balance withdrawals. This flaw allowed attackers to execute UserBalanceOpKind.WITHDRAW_INTERNAL operations without the necessary permissions.
Tweet Excerpt: "manageUserBalance in @Balancer has a faulty access check... It allows to execute
UserBalanceOpKind.WITHDRAW_INTERNAL(kind = 1)." (Source)
Market Sentiment and Technical Indicators
Since the hack's disclosure, BAL has lost significant support levels, including a critical one at $0.915. The BAL/USD 4-hour chart turned bearish, with indicators signaling substantial selling pressure. The RSI (Relative Strength Index) currently reads 43, placing it in a bearish zone below the neutral level of 50. Additionally, the MACD lines have crossed into the negative territory, reinforcing a bearish outlook.
Potential Price Movement for BAL
If the selloff persists, BAL could see its price drop below $0.8, targeting the next major support level at $0.735, which has held since April 8. Failure to maintain this level might trigger a new yearly low for the coin. However, should BAL recover, it would need to breach the $0.915 support-turned-resistance level to regain upward momentum, eventually targeting the $1.0 psychological level.