Attack On This DeFi Altcoin Project: Its Price Has Begun To Drop!

DeFi Altcoin: Most DeFi protocols are vulnerable to cyberattacks, despite the high profits they offer. The latest example of this came from Inverse Finance, one of the DeFi altcoin projects. Accordingly, Inverse Finance suffered a flash loan attack today. Cyber ​​hackers stole $1.2 million worth of Bitcoin and Tether in the attack. The identity of the culprits is unknown.

Cyberattack on DeFi altcoin project Inverse Finance

Flash loan attacks continue to come up frequently. Finally, in the attack on the DeFi platform Inverse Finance, users lost their funds. Cyber ​​hackers attacked the platform at 11:47 Turkish time. According to on-chain data, the attack was made through 27,000 Wrapped Bitcoins. As a result, the attackers stole 53 Bitcoin (BTC) and 100,000 Tether (USDT) from user funds in Inverse Finance. Accordingly, the value of the stolen altcoin assets, according to today’s prices, corresponds to 1.2 million dollars.

After the cyber attack took place and user funds were stolen, Inverse Finance made a post. DeFi protocol shared the official Twitter account. Accordingly, the platform announced that it is restricting critical elements of DeFi, such as debt transactions, for a limited time. However, he tried to reassure his users by saying that the team is investigating the attack. In addition, it was noteworthy that the attack took place two months after the event on Inverse Finance, which resulted in the loss of 15 million. Inverse Finance’s Twitter post was as follows:

“Inverse temporarily paused debt following an event this morning when DOLA was removed from our money market Frontier. We are investigating the incident, but no user funding was received or at risk. We are investigating and will provide more details soon.”

What is a flash loan attack? How did it happen?

Flash loan is a DeFi-specific mechanism that allows users to borrow large sums of altcoin loans with small collateral as long as they are repaid. Accordingly, the mechanism is generally used by traders. But bad actors can use a protocol’s smart contract to manipulate prices in liquidity pools. They can also take advantage of this mechanism to trick that pool into taking over its assets.

Blockchain data shows the hackers received a Flash loan from lending protocol Aave to carry out the attack. Accordingly, they have received over 27,000 Wrapped Bitcoin loans. The attackers routed loans through the exchange service Curve for various stablecoins. He then used DOLA, a stablecoin in Inverse Finance, to remove it from Inverse Finance pools. An address labeled “Reverse Finance Exploiter” on blockchain analytics tool Etherscan sent more than 900 altcoin ETH worth over $1 million to privacy mixer Tornado Cash after the exploit. As we have reported, Tornado Cash allows users to mask addresses. However, it can sometimes be used by attackers to hide their stolen funds.

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Larry Brown

I graduated from Yale University, Department of Television. I have been a professional news writer for 3 years. I am continuing my career here by establishing site 3 months ago.