Defi Protocol That Bragged About Having Flash Loan Attack Prevention Hacked for $6 Million

A decentralized finance (defi) protocol that bragged about having flash mortgage assault prevention has been exploited for $6 million in DAI, in a flash mortgage assault.

Price Defi, a yield aggregating protocol, boasted of getting the “best possible safety” in a Nov. 13 tweet that now seems to had been deleted. The protocol claimed that its generation was once in a position to combating flash mortgage assaults.

Infrequently an afternoon later, hackers plundered Price Defi’s multi-stablecoin vault of a complete of $eight million of the stablecoin DAI. The attacker returned $2 million to the protocol and pocketed $6 million — and with it left one audacious message mentioning, “do you in reality know flashloan?”

Price Defi mentioned it suffered a “advanced assault that led to a web lack of $6 million.”

The hacker took out a mortgage of 80,000 ether from the defi lending platform Aave and likewise borrowed an extra $116 million in DAI from Uniswap. In keeping with Price Defi’s postmortem of the incident, the attacker swapped the ETH mortgage for stablecoins and deposited a part of the flash-loaned DAI into the protocol’s vault.

He then made a sequence of stablecoin swaps involving USDT, USDC, and DAI — one way that finally exploits Price Defi’s vault withdrawal way. Aave developer Emiliano Bonassi exclaimed:

That is the advanced exploit I’ve ever noticed. It used two flashloans.

Flash loans permit customers to borrow cash with out collateral for the reason that lender expects the price range to be returned inside one transaction block, virtually straight away. Hackers have used this loophole in defi to thieve hundreds of thousands of bucks.

In its postmortem, Price Defi mentioned it was once taking a look at tactics to compensate affected customers. It said that customers can declare 20% in DAI from the $2 million that was once returned via the hackers. The protocol may be mountain climbing transaction charges to generate source of revenue for reimbursement.

“We can create a reimbursement fund which will probably be funded via a mixture of the dev fund, insurance coverage fund and a portion of the charges which are lately generated via the protocol,” it defined.

The cost of Price Defi’s local token, worth liquidity, plunged up to 28% at the day of the assault to $1.99 from $2.76, in keeping with Coingecko knowledge. At press time, the token was once buying and selling at $2.05, down four.nine% in 24 hours.

This newest exploit comes simply two days after every other $2 million heist at defi lending protocol Akropolis.

What do you take into accounts the frequency of flash mortgage assaults within the defi trade? Tell us within the feedback segment underneath.

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