Binance Says Latest Filecoin Double Deposit Was An API Mistake

Binance says latest Filecoin “Double deposit” was simply an API mistake and an “incorrect use” as we can see more in our latest Binance news today.

Users discovered one Filecoin exploit which allowed funds to be deposited more than once on the exchange but it was not double-spending reportedly as Binance says the latest Filecoin events occurred because of an API mistake. There were reports of an exploit that allowed $4.6 million in FIL tokens to be deposited more than once on the exchange but both platforms claim that it was incorrect to use APIs rather than a bug.

The issue resembled a double-spending issue that is usually brought by an attack on the blockcahin allowing the same cryptocurrency to be spent twice. Filecoin is a token that helps enable a decentralized storage network. The PoW consensus mechanism which backs BTC and other cryptocurrencies are meant to prevent double-spending but the transactions only happened on the FIL blockchain even though Binance accepted the transaction twice so it looked like a double deposit rather than a double spend.

A blog from Protocol Labs said that during an investigation they found no issues with the network or the remote procedure call API code. In the statements published to news outlets, a spokesperson said:

 “We are confident that there is no double-spend on the blockchain itself.”

The Lotus team also received a report from the exchange about the incorrect use of a Lotus API to evaluate transfers and deposits on the network:

“The team investigated & found *no network issue or API bug*. They’re working w/ all exchanges to ensure these APIs are correctly used.

— Filecoin (@Filecoin) March 18, 2021”

Binance explained that the deposits of the FIL token were halted a day ago in the wake of the double deposit issue and one spokesperson said:

 “The issue was caused by the incorrect use of the Lotus [Filecoin’s software suite] API logic and its integration in transferring and depositing into the Filecoin Network.”

According to the Binance spokesperson, there was no loss of funds. As recently reported, Cameron Winklevoss who is the co-founder of Gemini showed more optimism towards FIL and its recent growth. A few hours after his statement, Grayscale CEO Michael Sonnenshein announced the addition of FIL to Grayscale’s investment products list. Typically the growth rate of the blockchain protocol can be analyzed with three metrics like mining activity, transaction volume, and developer activity.