Venus protocol loses $11 million to attackers

TL;DR Breakdown
  • Venus protocol suffers loss as LUNA declines further
  • The attackers exploited the LUNA price feed suspension
  • Exchanges suspend trades of LUNA

Venus protocol has announced that it encountered loss as attackers took advantage of the LUNA price decline to hit its platform. According to new reports, Venus protocol is not only the platform exploited as another protocol also suffered the same fate. The statement claimed that a price feed error caused the incident to happen. Chainlink halted its price feed that most of these protocols leverage as the asset continue to deplete in value.

Venus suffers price feed suspension woes

Venus protocol said the price of the token on its platform was still at $0.10 while the token sold for $0.01 in the market. Due to the price suspension, the attackers could withdraw more than $11 million from the protocol. However, the platform has noted that it will use its risk funds to ensure everything is running smoothly on the protocol.

On the other hand, Blizz Finance said that the bad actors leveraged the price of LUNA at $0.10 to borrow collateral while depositing massive amounts of tokens. The platform based on Avalanche provides liquidity to traders in the decentralized finance industry. While that happened, the Blizz Finance team was not aware until the attackers drained the pool. However, the team has apologized to all its users affected by the attackers’ actions.

Exchanges suspend trades of LUNA

Although much of the blame has been directed towards the price feed suspension, some parties have come out to question the negligence of the platforms. A Twitter handle claims that they could have leveraged the toll on Chainlink that would have helped them eliminate the issue but chose not to do it. Meanwhile, the Terra blockchain has been halted abruptly following a massive 99% drop in its token value.

In the statement by the company, the blockchain was halted to prevent it from suffering from governance attacks. Also, the development team has been charged with the responsibility of restarting the blockchain. With the massive price decline of the LUNA token, exchanges have been taking measures to protect their users from volatile assets. While some exchanges have suspended the trades of the token, others like Binance and Bundle have delisted the asset from their platforms. Binance previously alerted its users that the coin would be deleted from the platform if the value declined further.

Owotunse Adebayo

Owotunse Adebayo

Adebayo loves to keep tab of exciting projects in the blockchain space. He is a seasoned writer who has written tons of articles about cryptocurrencies and blockchain.

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