Flow (FLOW) was left behind as the broader market recovered, with this token experiencing a double-digit decline over the past 24 hours.
This adjustment occurred while the Flow network was still working to resolve issues after recently facing a hack.
Why did the price of the FLOW token drop?
The cryptocurrency market has increased by nearly 2.3% today, with the top 10 assets trading in positive territory. Bitcoin (BTC) has moved above 90,000 USD, while the price of Ethereum (ETH) has also surged past 3,000 USD.
However, FLOW did not benefit from the overall market rebound. Data from BeInCrypto Markets indicates that this altcoin has dropped nearly 14% in the last 24 hours, becoming the second-largest daily loser on CoinGecko.
It should be noted that the decline is not limited to today, as like the overall market, FLOW has faced challenges over the past few months.
However, the significant drop occurred on December 27 after the network faced security issues, with prices plunging more than 50% in one day, reaching a new low of 0.079 USD on Binance, while leading South Korean exchanges, including Upbit and Bithumb, suspended deposits and withdrawals of FLOW.
Flow (FLOW) has been designated as an asset to watch by members of the Digital Asset Exchange Alliance (DAXA), and the deposit and withdrawal services for Flow (FLOW) have been suspended. When services resume, only withdrawals will be allowed, while deposits will be announced later as part of the procedure following the asset watch announcement. For the announcement from Upbit, you can read it here.
The Flow Foundation has entered the recovery phase after being attacked for 3.9 million USD.
On December 27, attackers moved approximately 3.9 million USD worth of assets out of the Flow network after exploiting a vulnerability in the processing layer of the system. The team was able to control the situation in time, preventing any further damage.
The Flow Foundation emphasizes that this incident did not affect the balances of existing users at that time.
The amount confirmed to have been moved out remains at a manageable level, which does not pose a threat to the network's stability or user funds. The most important goal right now is to resolve the issues and safely restart the system, as the foundation has written.
Initially, Flow proposed to restore the network status to the point before the attack occurred. However, after receiving substantial feedback from reviewers and the developer community, the foundation revised its plan and proposed a new solution approach.
This new approach will not roll back the network or change the order of transactions to maintain normal user activity, as the foundation states that more than 99.9% of accounts are unaffected and will be fully operational when the network restarts.
When the network restarts, accounts identified as having received tokens that were created through fraud will have their usage temporarily restricted as a precautionary measure... The core development team of Flow will propose that node operators upgrade the software, which will allow the community governance council to take action to rectify the temporarily fraudulent assets, the post further states.
Subsequently, the foundation announced that the reviewers have approved the software upgrade, and the network is currently in the process of troubleshooting and system testing. Under the recovery plan for the Flow network, phase one will begin at 6:00 AM PT.
At that time, the Cadence environment will return to normal operation, while accounts affected by the attacker's actions will continue to have their usage temporarily restricted.
The EVM environment will also remain restricted to read-only mode, with the foundation stating that more than 99.9% of Cadence accounts will be fully operational during this period.
This development reflects the ongoing efforts of the team to restore normalcy. However, it remains unclear whether this recovery process will be sufficient to rebuild market confidence and support price recovery.
