CryptoSlate
The PancakeSwap pool for 79AU, 79thVault’s token, lost $14.35 million in USDT on Oct. 7 through sales by two wallets, according to a Bitquery investigation published Oct. 8. Bitquery found that 79% of the pool’s liquidity-provider receipts had been burned, but a permission in 79AU allowed tokens to leave the pool without payment and be sold for USDT.
Why it matters
LP receipts represent a provider’s share of a pool and can be sent to an inaccessible address to prevent ordinary redemption. That does not disable swaps. PancakeSwap’s V2 documentation and archived pair contract distinguish LP redemption from swaps: swaps exchange the underlying assets without consuming receipts, while the contract separately updates its recorded reserves to match token balances.
Burning receipts also does not change the underlying token contracts or revoke privileged token permissions. In this case, the permission let tokens leave the pool outside the normal redemption process, leaving the pool exposed despite most LP receipts being burned.
Market impact
At 12:53 UTC on Oct. 8, Bitquery identified two pull-authorized addresses: the deployer and a newly authorized wallet. Read-only simulations showed either address could remove about 95% of the pool’s remaining 79AU. The simulations moved no funds.
A wallet still held the unburned 21% of LP receipts, which retained ordinary redemption rights over that share. Whether the reported exposure has ended depends on a fresh check of the 79AU transfer permission.
Frequently asked questions
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How did the 79AU pool lose funds despite most LP receipts being burned?
A permission in 79AU let tokens leave the PancakeSwap pool without payment. The tokens were then sold for USDT, bypassing ordinary liquidity redemption.
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What do LP receipts represent in a PancakeSwap pool?
LP receipts represent a provider’s share of a pool and provide ordinary redemption rights. They are separate from the assets traders exchange in swaps.
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Why did burning LP receipts not stop the 79AU drain?
Burning receipts prevents their ordinary redemption, but does not disable swaps, change underlying token contracts, or revoke privileged token permissions.
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What did Bitquery's simulations show about the authorized addresses?
At 12:53 UTC on Oct. 8, read-only simulations showed either of two pull-authorized addresses could remove about 95% of the remaining 79AU. The tests moved no funds.
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What exposure remained in the 79AU pool after the reported drain?
One wallet held the unburned 21% of LP receipts, retaining ordinary redemption rights over that share. The reported exposure depended on the status of the 79AU transfer permission.
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