Ethereum Layer 2 scaling solution Optimism fixes ‘critical bug’ preventing massive losses

Ethereum Layer 2 scaling solution Optimism recently patch a “critical bug” in its network which was discovered last week. A bounty award of over $2 million was given to Jay Freeman, the developer behind the Cydia and Orchid Protocol.

Optimism deploys major fix on its network

The fourth-largest Layer 2 Ethereum scaling solution by total value locked, Optimism was alerted to the vulnerability last week on the network. 

The bug was thought to have been triggered by an Etherscan employee by accident but was never exploited.

If exploited, the bug would have allowed for repeated ETH creation on the network through triggering a code on the contract that held ETH balance. 

Freeman was awarded the maximum bounty award of over $2 million for notifying Optimism of the vulnerability. The network could have suffered larger potential losses if the bug was never discovered.

According to Optimism, the fix for the issue was tested and deployed to Optimism’s Kovan and Mainnet networks within hours of confirmation. The team further alerted other vulnerable Optimism forks and bridge providers of the issue and all projects have patched a fix for the bug.

Ethereum price vulnerable to 16% drop

Ethereum price could be headed for a steep decline if the critical lines of defense fail to hold. The token has formed a rising wedge pattern on the 4-hour chart, putting ETH at risk of a drop toward $2,511.

The first foothold for Ethereum price is at the 50 four-hour Simple Moving Average (SMA) at $2,992, coinciding with the 38.2% Fibonacci retracement level and the support line given by the Momentum Reversal Indicator (MRI). 

ETH/USDT 4-hour chart

The next line of defense for ETH is at the lower boundary of the governing technical pattern at $2,903, intersecting with the 200 four-hour SMA.

However, if buying pressure increases, Ethereum price could tag the 21 four-hour SMA at $3,154, coinciding with the 23.6% Fibonacci retracement level next.