DeFi Warp Protocol Losses $7.7 Million in a Flash Loan Attack

Lending protocol, Warp was exploited with a complex flash loan attack for $7.7 million worth of stablecoins. Hacken Club audited the project.

The attack on Thursday allowed the hacker to borrow more than their collateral value resulting in a loss of stablecoin lender funds. Later on Thursday or earlier on Friday, the team took to Twitter to share with the community,

“We are investigating irregular stablecoin loans taken out in the last hour, we recommend that you do not deposit anymore stablecoins until we have clarity on the irregularities.”

Out of the lost $7.7 million, the team plans to recover about $5.5 million that is still “secured in the collateral vault.”

“Upon successful recovery, these will be distributed to users who experienced a loss,” announced the team. Additional plans are also in place to compensate for users’ loss over time, they added.

The decentralized finance project team said they would share a detailed analysis of the attack in the coming days once they have more understanding of the exploit.

Just a day before the attack, the lending protocol that powers a liquidity engine migrated to Warp Finance v2 with a 24 hours grace period. The latest version enabled borrowing for protocol users against LP tokens and be rewarded with the to-be-released governance token WARP.

The TVL of the project has more than halved after the attack. Only $6 million funds are currently locked in the project, down from $17 million, as per DeBank.

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Author: AnTy

Wrapped Bitcoin (WBTC) Beats Aave & Curve to Become the Third Largest DeFi Project

Bitcoin on Ethereum continues to grow at warp speed, reaching above $1.6 billion, on pace with 145k BTC.

Several projects like renBTC, imBTC, HBTC, TBTC, pBTC, and sBTC are putting BTC on the second largest network. Wrapped Bitcoin (WBTC) dominates this growth by accounting for 73.6% of the BTC on Ethereum.

105,132 WBTC worth $1.2 billion has been minted so far, which has increased a whopping 9,380% since the beginning of 2020.

With this, WBTC has jumped past the likes of Yearn.Finance, Synthetix, Compound, Curve Finance, and Aave to become the third-largest DeFi project.

Uniswap, with a record of $2.73 billion in total value locked (TVL) and dominance of 24.12%, and Maker with nearly $2 billion of crypto funds locked are the only ones bigger than Wrapped Bitcoin.

wbtc
Source: DeFiPulse

WBTC is one of the fastest-growing DeFi projects, much like the overall sector, which is hitting new highs of $11.4 billion in TVL.

Interestingly, yesterday, the largest WBTC was minted in a single day by CoinList. This largest mint of 5,000 WBTC was made in two separate transactions — the first one involved 1,299.48 WBTC while the second transaction involved 3,697.5 WBTC.

This record breaks the last one made by FTX CEO Sam Bakman-Fried’s crypto trading firm Almeda Research that one-upped the previous record with 2,316.5 WBTC.

WBTC is an ERC-20 token backed by bitcoin in a 1:1 ratio, where the BTC is held in the custody of BitGo.

With this, DeFi users can participate in various applications without actually using their Bitcoin. It further brings Bitcoin’s vast liquidity, with a $210 billion market, to the $42 billion market cap Ethereum network.

Demand for WBTC continues to soar, as seen in its growth as this allows Bitcoin holders to take part in exciting DeFi apps like yield farming and earn income on their BTC without giving it up.

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Author: AnTy