March 27, 2024
DeFi Protocols Face $38.9M Losses in January
Latest Cryptocurrency News

DeFi Protocols Face $38.9M Losses in January

In January, decentralized finance (DeFi) security firm Quantstamp identified the top five smart contract protocols that suffered significant losses due to exploits and hacking incidents. Bad actors utilized various attack methods, including smart contract hacks, key compromises, and scams, resulting in total losses of $38.9 million.

Radiant Capital faced $4.5 million in losses in a flash loan attack in early January, attributed to a known rounding issue in the Compound/Aave codebase. The DeFi lender halted its USD Coin pool on Arbitrum to address the problem, ensuring user funds’ security. Gamma Strategies experienced a flash loan attack on Jan. 4, resulting in a code bug enabling attackers to siphon $6.1 million from Gamma’s public-facing vaults.

Wise Lending incurred a minimum loss of $460,000 in a flash loan assault in January. 12, involving price oracle manipulation. On Jan. 16, Socket faced a security breach, allowing hackers to steal nearly 2,000 ETH, valued at over $4 million. Finally, on Jan. 28, Goledo Finance experienced a flash loan attack similar to Gamma’s exploit, resulting in the theft of $1.7 million. Negotiations with the perpetrator are ongoing, and Goledo has frozen the hacker’s accounts on centralized exchanges.

The team is evaluating the loss extent to formalize a recovery strategy, and law enforcement has been briefed. Goledo has set out a compensation process for user asset recovery, providing a Google form for users to submit claims. These incidents highlight the ongoing challenges in DeFi security, emphasizing the importance of robust protocols and continuous monitoring to mitigate potential vulnerabilities and protect user funds.

Image by Freepik

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