A hacker exploited the decentralized finance (DeFi) platform Euler Finance early Monday morning and stole round $200 million price of crypto, in accordance with the blockchain safety agency SlowMist.
Euler Finance, a non-custodial lending protocol constructed on Ethereum (ETH), acknowledged the hack on Monday, noting that it was working with legislation enforcement and unbiased auditors and safety companies.
Explains SlowMist,
“The attacker used flashloans to deposit funds and then leveraged them twice to trigger the liquidation logic, donating the funds to the reserve address and conducting a self-liquidation to collect any remaining assets.”
The blockchain safety agency notes that the hacker donated funds to the reserve tackle with out being subjected to a liquidity test, which “created a mechanism that could directly trigger soft liquidation.”
“When the gentle liquidation logic was triggered by excessive leverage, the yield worth elevated, enabling the liquidator to acquire many of the collateral funds from the liquidated consumer’s account by transferring solely a portion of the liabilities to themselves.
Given that the worth of the collateral funds exceeded the worth of the liabilities (which have been solely partially transferred because of the gentle liquidation), the liquidator was capable of efficiently cross their well being issue test (checkLiquidity) and withdraw the obtained funds.”
According to Lookonchain, Euler misplaced roughly 96,833 ETH, price round $166 million at time of writing, and $34 million price of the USD-pegged stablecoin DAI.
In its 2023 Crypto Crime Report, blockchain knowledge platform Chainalysis notes that hackers stole a complete of $3.8 billion from cryptocurrency companies final yr, the very best annual whole ever. The hackers made off with a overwhelming majority of that whole by concentrating on DeFi protocols.
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