Decentralized finance (DeFi) protocol Platypus has fallen victim to its third flash loan exploit this year, losing a staggering $2.2 million in assets. The attacks, occurring in rapid succession, have raised concerns over the platform’s security and stability. In response, Platypus has suspended all of its pools. These attacks have exposed the vulnerability of flash loan exploits, a prevalent issue in the DeFi space.
In yet another blow to the DeFi community, Platypus has fallen prey to its third flash loan exploit in 2023, resulting in a loss exceeding $2.2 million in assets. The attacks took place, marking a concerning trend for the platform’s security.
The flash loan exploit that plagued Platypus is a recurrent issue in the DeFi space. This malicious tactic allows attackers to exploit vulnerabilities, permitting them to instantaneously borrow cryptocurrency without providing the required collateral for the transaction. This vulnerability exposes the inherent risks within DeFi platforms and calls for enhanced security measures.
Platypus DeFi’s ongoing struggles
The triple attack on Platypus unfolded in quick succession. In the first breach, the assailants made off with $1.2 million worth of assets. A mere few hours later, a second attack occurred, resulting in a loss of $575,000 in assets. Shockingly, the third assault transpired just minutes after the second, causing a loss of $450,000 in assets. This series of breaches not only raises questions about the platform’s security measures but also underscores the sophistication of the attackers behind these exploits.
Platypus is an automated market maker (AMM) protocol operating within the DeFi ecosystem. Unlike traditional markets with buyers and sellers, this platform enables the automatic trading of digital assets through liquidity pools. In 2021, the project raised $3.3 million in funding, led by Three Arrows Capital, which has since filed for bankruptcy.
This year has proven tumultuous for Platypus, with previous flash loan exploits causing substantial losses. In February, the platform lost a staggering $8.5 million in a similar attack. This exploit also led to the de-pegging of the Platypus USD stablecoin, plummeting its price from $1 to a mere $0.48. Additionally, Platypus DeFi fell victim to a flash loan exploit, resulting in a loss of approximately $157,000.
In response to the flash loan attacks earlier this year, Platypus established a compensation portal. This portal was created to aid victims who had lost their assets in the February exploit. Through the portal, users could verify the compensation they were eligible to receive and voice their concerns before the distribution of funds. These efforts aimed to mitigate the damage inflicted on the affected users and restore some trust in the platform.
