Bug in DeFi Protocol Compound Mistakenly Sends $82 Million In COMP Rewards to Users

Bug in DeFi Protocol Compound Mistakenly Sends $82 Million In COMP Rewards to Users

Robert Leshner, the founder of the DeFi project, which has the fifth-largest TVL at $9.63 billion, says the mistaken claims have been at worst 280k COMP tokens worth about $82 million.

Decentralized finance protocol (DeFi) Compound encountered a bug in its code that resulted in erroneously giving an unusual amount of COMP tokens worth millions of dollars in liquidity mining rewards.

“Unusual activity has been reported regarding the distribution of COMP following the execution of Proposal 062,” tweeted the team late on Wednesday.

But the team assured that no supplied or borrowed funds are at risk, and the team is investigating discrepancies in the COMP distribution.

Proposal 62, which went into effect on Wednesday, intended to have two different COMP distribution rates for each market, borrow-side and supply-side rates, instead of the previous 50/50 share model.

But the updated Comptroller Contract contained a new bug that allowed some users to claim thousands of COMP tokens. According to Robert Leshner, founder of Compound Labs, the mistaken claims have been at worst 280k COMP tokens worth about $82 million.

“Exploiters were people that had borrowed some time ago, borrowing now and trying to exploit doesn’t work,” said 0xngmi of DeFiLlama.

In a series of tweets, Leshner shared that the new Comptroller contract ended up distributing far too many COMP tokens to users of the protocol. The proposal and the contract, he further shared, were written by a community member.

“All supplied assets, borrowed assets, and positions are completely unaffected. Users don’t have to worry about their funds; the only risk is that you (or another user) receives an unfairly large quantity of COMP.”

Leshner went on to explain that there are no tools or admin controls to disable this COMP distribution. Moreover, any changes to the protocol require a 7-day governance process to make their way into production.

Compound Labs and community members are now “evaluating potential steps to patch the COMP distribution.”

Compound Finance is the fifth largest DeFi project with $9.63 billion in total value locked (TVL), down from almost $13 billion ATH earlier this month.

The project token has a market cap of $1.73 billion and is down 12% in the past 24 hours to trade at $293.69, down 68% from the mid-May peak of $910.5.

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Author: AnTy

1Inch Moves to Arbitrum For Faster Throughput And Lower Gas Fees

Ethereum multi-chain solution, Arbitrum One is seeing major adoption by the day. The latest protocol looking to tap into lower fees and faster transactions is 1Inch Network.

1Inch Moves To Arbitrum

According to a Wednesday tweet, popular decentralized cryptocurrency exchange (DEX) aggregator 1Inch Network announced support to Ethereum layer-two scaling solution Arbitrum.

The move is expected to give 1Inch users and DeFi proponents lower transaction costs, higher transaction speeds, and fast withdrawals.

Much like the former Matic Network, Arbitrum uses roll-ups and sits atop the Ethereum network. It is tasked with bundling transactions together and validating them before adding them to the main Ethereum network.

This technology greatly aids the Ethereum network to continue operating as the older decentralized applications (dApps) platform battles with the twin challenges of network congestion and high gas fees.

Arbitrum’s lower gas fees and higher throughput would benefit 1Inch users known to use the DEX aggregator to search for competitive prices across several exchanges.

Commenting on the recent integration with 1Inch, CEO of the development team behind Arbitrum, Offchain Labs Steven Goldfeder said;

“The Arbitrum One ecosystem is vibrant with many excellent and high volume DEXes, and we’re very excited to have 1Inch users join as a DEX aggregator.”

1Inch also stated in the announcement that a total of seven protocols would be available once it launches on Arbitrum. This includes the 1Inch Limit Order Protocol, UniSwap, BalancerLabs, BreederDodo, SushiSwap, SwaprEth, and WETH, with more expected in the future.

Arbitrum Making Waves Despite Being A Newbie

Like several Optimistic Rollup solutions, Arbitrum is built with the same code that operates on the Ethereum network. This enables development teams to easily cross-compile smart contracts on both networks, and it also ensures full compatibility between the Ethereum network on smart contracts and the Web3.0 interface levels.

Meanwhile, Arbitrum has been a major success since launching on August 31. The layer-two scaling solution has seen growing adoption from major protocols, most especially from the DeFi-facing sub-sector.

Also, its lower fees and faster transaction speed has lured non-fungible tokens (NFTs) enthusiasts who have now shifted their attention to the newcomer. According to data from L2 Beat, over $2 billion total value locked (TVL) have been processed through the Arbitrum protocol.

This has been due to surging interest in viral internet sensation NYAN. The digital meme token, which shows a rainbow-themed Nyan cat, has been in hot demand as digital collectible fans look to farm the ERC-20 token.

Developed by an anonymous developer, NYAN is meant to generate buzz about the Arbitrum network and encourages investors to lock up tokens on Arbitrum to receive rewards, according to a September 8 tweet.

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Author: Jimmy Aki

Wormhole Launches Solana-Ethereum Bridge to Move NFTs Cross-Chain

Solana-based interoperability protocol Wormhole officially announced the launch of a cross-chain bridge between the competitors Solana (SOL) and Ethereum (ETH).

This bridge will enable the transfer of digital assets between ERC-20 and SPL blockchains.

The total value locked (TVL) in the decentralized finance space has skyrocketed to nearly $170 billion, climbing towards the $192 billion peak earlier this month. This growth in TVL continues to grow as more and more layer 1 blockchains gain traction, driving this demand for cross-chain bridges.

Ethereum is currently in the lead at $118 billion, followed by Binance Smart Chain (BSC) at $16.23 billion, then Solana at $8.74 billion, Terra $8.05 billion, Polygon at $4.1 billion, Avalanche $3.16 billion, and Fantom at $1.24 billion, according to DeFi Llama.

As Yearn Finance (YFI) creator Andre Cronje explained last week in a panel hosted by Sanctor Capital,

“The whole DeFi wave gave a reason for people to begin interacting with different blockchains.”

“The more we’re interacting, the more we are realising that there’s actually a little bit too much activity for any one chain to handle this stuff.”

“While I can’t specifically pinpoint a big bang moment, it’s a combination of the maturing of different blockchains and their DeFi ecosystems, and things like NFTs that are giving people more and more of a reason to interact.”

On Wednesday, Wormhole stated that they are launching the NFT bridge between Ethereum and Solana, meaning users will now be able to send Ethereum and Solana NFTs such as CryptoPunks and Bored Ape Yacht Club, and Degen Ape Academy cross-chain.

Just like different layer 1 blockchains are cropping up and ruling the cryptocurrency market, non-fungible tokens (NFT) are all the mania right now as well.

NFTs are currently the most vibrant sector, representing material activity on Ethereum, as can be seen in the daily number of ERC-721 transfers that increased by over 10x from the beginning of 2021 to today.

NFT marketplace OpenSea, meanwhile, is the economic hub of NFT activity on Ethereum, which grew at a staggering pace this year. In August, OpenSea registered more than $3 billion in total volume while the number of unique buyers peaked at 35k the same month.

Besides attracting new users and generating new economic activity, NFTs also congested the Ethereum network and started growing on other blockchains, which offered cheaper and faster alternatives.

So, Wormhole is enabling the users to move digital art across the two blockchains.

For now, in the initial version, the bridge will only support ERC-721 (with metadata) and SPL assets with plans to expand NFT support even further to enable cross-chain transfers of ERC-1155 assets as well.

“We can’t wait to see how users will leverage the NFT bridge to bring together previously disparate communities of artists, musicians, and content creators across multiple ecosystems,” tweeted the team.

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Author: AnTy

Drama Ridden Cover Protocol and Ruler Protocol Shuts Down After Dev Team Leaves Suddenly

Drama Ridden Cover Protocol and Ruler Protocol Shuts Down After Development Team Leaves Suddenly

Decentralized insurance provider Cover Protocol has announced its shut down after their development team left the project. Its sister firm, a smaller lending platform, Ruler, is also shutting down.

The news sent the prices of the tokens of both the platforms crashing with COVER down more than 22% since the Cover team first announced it on Saturday, to trade at $215, while RULER is down over 90% during the same period to trade at $1.2.

The community manager DeFi Ted didn’t reveal why the development team left but said,

“The decision to do this did not come easy and is a final decision the remaining team made after reviewing the path forward after the core developers suddenly left the projects.”

The remaining team has decided to disperse the remaining treasury funds to token holders as a creditor payout, for which a snapshot will be taken at block number 13162680.

Going forward, the team will not be continuing with the RULER & COVER token or contracts, and the UI will be shut down.

The Cover protocol, however, has always been plagued with issues. Last December, it was the victim of a white hat attack. In March this year, DeFi blue-chip Yearn Finance canceled its plans to merge with Cover.

COVER Protocol was also a rebranding from yieldfarming.insure project (SAFE) about a year ago. The launch of the yieldfarming.insure project was a debacle in itself which later gained support from Yearn’s Andre Cronje and FTX CEO Sam Bankman-Fried as advisors, and even the relaunch wasn’t without any issues.

DeFi Ted now warned users to withdraw any funds from both protocols as soon as possible.

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Author: AnTy

Solana Based DeFi Protocol, Luna Yield, Goes Dark as Customers Fear An Exit Scam: Report

Solana Based DeFi Protocol, Luna Yield, Goes Dark as Customers Fear An Exit Scam: Report

While the market appears to be rallying once more, this month hasn’t been all sunshine and rainbows for crypto platforms. In what is growing to be an alarming trend, it appears that a rug pull might have duped some crypto investors.

Nowhere to be Found

Earlier today, SolPad, an Initial Digital Offering (IDO) platform built on the Solana blockchain, confirmed that one of its platforms has gone completely dark. The platform, named Luna Yield, offers yield farming with vaults that are available on Solana (SOL), Polygon (MATIC), and the Binance Smart Chain.

In its tweet, SolPad explained that the platform appeared to have been witnessing problems. The service scrubbed its online presence, deleting its websites and social media channels. The website is still available on Google’s results page, but it can’t be reached.

Luna Yield was the second IDO to debut on SolPad, going live earlier this week. According to news sources, the platform had gotten $6.7 million in user funds and was building a relatively strong community. Now, it appears that all of those funds have been stolen.

According to an anonymous source, the platform’s founders reportedly took all of the SOL tokens in the platform and converted them to Ether. From there, they transferred the money to Tornado Cash – a decentralized, non-custodial privacy solution that’s built on the Ethereum blockchain. Put simply, those funds are gone and can’t be recovered.

Although the SolPad team has requested patience as they try to contact the Luna Yield developers. However, this situation already has the trappings of an exit scam – a case where a platform’s developers take off with investors’ funds. If indeed it is an exit scam, it would be a first on the Solana blockchain.

Criminal Activity Making a Comeback

The situation marks just the latest criminal event that will befall the crypto space in the past few weeks. Last week, cross-chain decentralized finance (DeFi) protocol Poly Network was hacked, with investors losing up to $610 million in digital assets. After multiple investigations, the hacker was said to have exploited a vulnerability between contact calls to conduct the hack.

Eventually, nearly all of the funds were restored after the hacker seemed to have grown a conscience.

Poly Network eventually claimed that the hack was filled with “white hat behavior” and even offered the hacker a job. They turned it down, along with the company’s $500,000 bounty.

While the industry was reeling from that, Liquid Global, a popular crypto exchange, was hit in a hack just yesterday. The Japanese exchange confirmed the hack on Twitter, noting that only its hot wallets had been affected.

Although Liquid has yet to confirm anything, news sources believe that the exchange lost about $80 million to the hack. There are also unconfirmed reports that the funds belonged to the Celsius Network, which integrated with Liquid in April to offer the latter’s customers a compounding return on their crypto purchases.

Efforts are being made to get the funds back, with fellow crypto exchange KuCoin blacklisting all addresses involved in the hack.

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Author: Jimmy Aki

Multi-Blockchain Communication Protocol Wormhole Goes Live, Bridging Solana, BSC, Ethereum, & Terra

Multi-Blockchain Communication Protocol Wormhole Goes Live, Bridging Solana, BSC, Ethereum, & Terra

Wormhole, an interoperability protocol that connects Solana with other networks, has announced the launch of its mainnet. With the launch of the mainnet, Wormhole would now support inter-blockchain message transfers.

Wormhole: Communication Bridge Supporting Arbitrary Data

Wormhole is not just an asset or communication bridge, it also supports arbitrary data. This means it enables the cross-chain transfer of any information. This information includes oracle data, governance votes, non-fungible tokens (NFTs), amongst others.

The protocol aims to fill the interoperability gap by connecting messages to other chains through a verifiable, trustless network. This network is supported by validator nodes, also known as Guardian nodes.

According to the announcement, the Wormhole mainnet would also support Ethereum, Terra, and Binance Smart Chain (BSC). The protocol plans to add other prominent chains in the near future.

The Wormhole protocol testnet was first announced in October 2020 by Solana. At the time, it only supported cross-chain transfers between Solana and Ethereum. The added support of the Terra and BSC blockchains is an improvement from Wormhole’s testnet phase.

Wormhole describes itself as a messaging protocol that allows information to flow freely cross-chain between previously siloed blockchains.

Furthermore, Wormhole comes with 19 validators where projects can monitor if an asset is locked up in one chain and is copied before freely moving to the next chain.

The protocol is built to be asynchronous, enabling low-latency consensus. This capability ensures information is utilized freely without any delays.

With this mainnet, Wormhole opens a faster and simpler route for non-native assets to enter Solana’s bustling decentralized finance ecosystem. Projects like Serum, a decentralized exchange (DEX) platform backed by FTX, could unlock added cross-chain liquidity through Wormhole.

Wormhole was formed as a result of a partnership between Solana and Certus One, a premier validator for distributed ledger technology (DLT). As of October, it was intended to connect ETH and ERC20 tokens to SPL Tokens, the fungible tokens of the Solana blockchain. Wormhole was formed to be the first of many bidirectional cross-chain bridges planned for the Solana network.

Founded in 2017, Solana is a high-performance Proof of Stake (PoS) blockchain that aims to solve problems in decentralized finance (DeFi). The blockchain focuses on solving problems surrounding speed, scale, and transaction fees, making it a preferred platform for decentralized applications (DApps).

Wormhole’s Partnership With Pyth Network

Wormhole had previously partnered with Solana-based network, Pyth in May this year. Pyth is an oracle protocol designed to retrieve data on-chain instantaneously. The partnership enabled Ethereum users to connect to the Solana network, including gaining Pyth’s data sourcing access.

Meanwhile, the Solana blockchain continues to thrive alongside the decentralized platforms built on it. Solana recently joined hands with music streaming service Audius and NFT marketplace Metaplex to launch a $5 million fund to attract artists and musicians to its platform.

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Author: Jimmy Aki

“Backdoor Bitcoin Ban?” Infrastructure Bill Creator Rob Portman Unveils Competing Amendment

Senator Rob Portman’s amendment, which supports PoW chains but punishes those using PoS protocol, for now, has gained support from Mark Warner, Kyrsten Sinema, and most importantly, the White House. Crypto experts are skeptical and urging the community to call their senators and support the Wyden-Lummis-Toomey amendment.

On Wednesday, as we reported, Cynthia Lummis (R- Wyo), Ron Wyden (D-Ore), and Pat Toomey (R-Pa) filed their amendments to the crypto tax provision, which has also gained the support of Colorado Governor Jared Polis.

Late on Thursday, then, Senator Rob Portman, who is behind the bipartisan infrastructure bill and its overreaching crypto policies, tweeted out his support for the Wyden-Lummis-Toomey amendment saying, “we can do more to clarify the intent of the cryptocurrency provision & the Senate should vote on their amendment,” which had the crypto community excited and increasingly hopeful of getting this done.

But in a quick turn of events, at the last minute, Portman proposed his own “whack competing” amendment with support from Mark Warner, D-Va and Kyrsten Sinema, D-Ariz, which support PoW chains but punishes those using PoS protocol.

“It is a disastrous. It only excludes proof-of-work mining. And it does nothing for software devs. Ridiculous!” said Jerry Brito, executive director of CoinCenter.

Blockchain Association executive director Kristin Smith warns that Portman and Warners’ amendment is anti-technology and anti-innovation that “would be disastrous for the U.S. crypto ecosystem.”

“If there is a worse way to make policy, someone is always ready to pounce. Hopefully it is simple ignorance rather than a malicious attack on a burgeoning FinTech industry. What a train wreck!” commented Congressman Warren Davidson, who is a crypto supporter.

Portman’s amendment even gained the support of the White House.

“The Administration believes this provision will strengthen tax compliance in this emerging area of finance and ensure that high income taxpayers are contributing what they owe under the law… we believe that the alternative amendment put forward by Senators Warner, Portman, and Sinema strikes the right balance and makes an important step forward in promoting tax compliance,” reads the statement attributed to Andrew Bates, White House Deputy Press Secretary.

This obviously took the crypto community by shock. They were quick to point out that this is absolutely wrong to do at the last moment and is an attempt to do what the original bill was planning all along, ban the crypto industry.

“Make no mistake, this is a backdoor Bitcoin ban. Compliance is impossible. Their intent is to criminalize full nodes, lightning nodes, and most Bitcoin wallets. And they are not really in favor of proof-of-work; the very next bill will include some ESG thing to attack that too,” tweeted Balaji Srinivasan, former Coinabse CTO, and General Partner at a16z.

The Senate plans to vote on the bipartisan infrastructure bill on Saturday.

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Author: AnTy

Avalanche Launches New Cross-Chain Bridge To Connect Users With Ethereum

Avalanche Launches New Cross-Chain Bridge To Connect Users With Ethereum

Blockchain protocol Avalanche has launched a new bridge aimed at facilitating cross-chain interoperability.

Avalanche Bridge To Replace Avalanche-Ethereum Bridge (AEB)

According to Emin Gün Sirer, creator of the Avalanche protocol, the new Avalanche Bridge (AB) would replace the existing Avalanche-Ethereum Bridge (AEB).

Sirer said the new bridge provides a faster user experience alongside stronger security and lower fees than the AEB bridge. Users will be able to merge Avalanche Bridge seamlessly with other basic applications of Avalanche like the Avalanche Wallet and Avalanche Explorer.

This bridge was built using Intel SGX Enclave technology, a software program that enables all operations in an environment to be secure.

Currently, the Avalanche Bridge will support only the Avalanche and Ethereum blockchain. However, the firm plans to rapidly expand the bridge to other new chains across the decentralized finance (DeFi) community.

Sirer is optimistic that the new Avalanche bridge will encourage users to explore the Avalanche blockchain and the DeFi sector more. He stated,

“Day-by-day I see incredible innovation happening across the Avalanche Community. This bridge will unlock a vast amount of opportunities for builders who get their start on $AVAX, as well as projects who have been waiting to expand to Avalanche.”

DeFi Protocols Migrating To Avalanche Network

Avalanche is an open-source platform for launching decentralized applications. Since its mainnet launch in September 2020, the platform has been focused on solving the speed and scalability problems of other blockchain platforms, especially Ethereum.

The platform claims to be an interoperable and highly scalable ecosystem that can process more than 4,500 transactions per second. Avalanche is similar to other base-layer blockchains like Solana and Binance Smart Chain. However, Avalanche has declared itself as the best smart contracts compatibility network.

Avalanche has been actively integrating other protocols on its blockchain recently. DeFi Yield farming platform, known as DYP, announced its expansion to Avalanche earlier this month. The platform revealed that three of its products, DYP Farming, DYP Tools, and DYP NFTs, would be live on Avalanche.

Before the DYP integration, Onomy, a crypto lender, also integrated its FX marketplace DEX called Onomy Exchange with Avalanche. The implementation of this partnership will be completed in Q3 2021.

Tenderly, a developer platform, also recently expanded to the Avalanche blockchain. This integration allows developers to use Tenderly’s toolkit to facilitate building on Avalanche. According to Tenderly, the toolkit allows for stressless bug fixing and testing different scenarios without spending any gas fees.

Avalanche has also been pushing its native token, AVAX. A few days ago, AVAX was launched on the digital asset trading platform BitMart. The tokens are now available for trading on the platform. Users would also be able to transfer AVAX tokens between their Avalanche Wallet and BitMart Account.

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Author: Jimmy Aki

Uniswap Introduces Token Censorship On its Front-End Due to ‘Regulatory’ Reasons

Uniswap Introduces Token Censorship On its Front-End Due to ‘Regulatory’ Reasons, Protocol Remains Decentralized as Ever

Users can still trade the delisted 129 tokens that include synthetic stocks, currencies, commodities, inverse derivatives, options, and yield-generating tokens; via decentralized interfaces and aggregators.

A total of 129 tokens, synthetic stocks, synthetic currencies, synthetic commodities, inverse derivatives, options, index products, yield-generating tokens; has been removed from the leading decentralized exchange (DEX) Uniswap, announced Uniswap Labs, a software studio that contributes to the protocol.

The delisting has been done in response to “the evolving regulatory landscape.”

These tokens include the likes of Gold Tether (XAUT), Grup Cat, Opyn cDai Insurance, Zelda Spring Nuts Cash, multiple Mirrored stock tokens, and several Synth cryptos and Synth Inverse cryptos.

They represent a “very small” portion of the overall volume on the Uniswap Protocol, it said in the announcement.

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The portal app.uniswap.org is an open-source interface for reliable interaction with the Uniswap Protocol. Unlike the interface, the Uniswap Protocol is a set of autonomous, decentralized, and immutable smart contracts which provide unrestricted access to anyone with an Internet connection, clarified the team.

As Banteg of Yearn Finance noted, “Uniswap has introduced token censorship on the main UI.”

It is the interface that is restricting the access to particular tokens, which is “consistent with actions taken by other DeFi interfaces” and has no impact on Uniswap Interface code or other portals or locally-run instances used to access the Protocol.

Users can basically still trade these affected assets via contracts, decentralized interfaces, or aggregators.

The crypto community didn’t take this news well, calling it a bad move. Some in the community wondered about the lack of UNI governance token holders’ input in the decision and the reason behind removing these particular coins, while others called for its demise.

“People can’t comprehend the difference between http://uniswap.org (a frontend owned by a company) and a protocol (a series of smart contracts hosted on ethereum) and cannot see this is regulator enforced,” commented influencer CryptoCobain who hosts UpOnly podcast.

“There’s no censorship at the contract level that’s the point of DeFi frontends are just a convenience for users. In a couple of years, only community run frontends will be around,” said a DeFi enthusiast.

Moving forward, Uniswap Labs said they would continue to develop products and contribute to the Uniswap Protocol in accordance with the broader DeFi industry’s values, that is, safe, transparent, and robust financial infrastructure to empower users around the world.

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Author: AnTy

Maker Foundation Dissolves to Give the Community Full Control Over the Protocol and DAO

Maker Foundation Dissolves to Give the Community Full Control Over the Protocol and DAO

Original decentralized finance (DeFi) project Maker has now completely decentralized MakerDAO making the community now responsible for the protocol.

It started as a DAO, then changed into a Foundation which was a temporary solution for the development of the popular lending protocol, an end to having a self-governed self-operating DAO, which it has now achieved.

This week, Rune Christensen, the CEO of Maker Foundation, announced that the DAO is now fully self-sufficient, and the Foundation will formally dissolve within the next few months.

Over the period of the last six years, its stablecoin DAI has grown to become a $5.25 billion market cap crypto-backed stablecoin.

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In Q2 of 2021, the supply of DAI grew 76%, producing $43 million in earnings, up 136% since 1Q21 and 21,500% year-over-year.

While DAI has a 5% market share of the stablecoin market, the lending protocol has $5.45 billion in outstanding debt compared to $6.62 billion on Compound and $6.89 billion on Aave.

“MakerDAO continues to provide one of the best demonstrations of profitable growth in DeFi,” noted Ryan Watkins of Messari, adding the project also has a powerful business model having zero infrastructure costs with users paying gas, zero cost of capital with MakerDAO minting DAI, and extremely high margin with very low headcount requirements while having global reach without the hurdle of regional financial regulations.

Currently, the project has over $8 billion in assets locked in smart contracts of the Maker Protocol.

In terms of total value locked (TVL), the protocol has $5.85 billion comprising 2.43 million ETH, nearly 17k BTC, and 61.36 million DAI.

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Author: AnTy