Warp Finance Hit With $8 Million DeFi Flash Loan Attack
Barely a week after Warp Finance went live, the DeFi platform has been hit with a flash loan attack worth nearly $8 million.
That was fast. Image: Shutterstock
Warp Finance has suffered a flash loan attack. According to the team, the attacker was able to suck nearly $8 million worth of stablecoins from the platform by borrowing more than they were ostensibly allowed to. The exploiter was able to remove $7.7m of stablecoins, tweeted the lending platform on Thursday evening. The team has a plan to recover approximately $5.5m that is still secured in the collateral vault. Upon successful recovery, these will be distributed to users who experienced a loss.
Dec 18, 2020 08:22 GMTCrypto News
Warp Finance got hacked via a flash loan attack.
The hacker used a complicated scheme based on multiple protocols and swaps.
The team has a plan to compensate users for losses.
Another DeFi project got hacked and lost about $8 million of user funds in DAI and USDC. The attacker exploited a sophisticated multi-protocol flash loan scheme and Tornado Cash to hide the digital trace.
Warp Finance is a DeFi platform that claims to offer “an optimized lending solution powering a liquidity engine.” In other words, they allowed users to take cryptocurrency loans using stablecoins as collateral. The project was launched in October 2020.
Warp Finance Suffers Possible $8M Flash Loan Attack
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Updated Dec 20, 2020 at 3:40 p.m. UTC
Warp Finance Suffers Possible $8M Flash Loan Attack
Decentralized finance (DeFi) platform Warp Finance was exploited for $8 million Thursday evening, possibly due to a flash loan attack, according to analysis portal DeFi Prime.
The exploit appears to be a flash loan attack, DeFi Prime said, citing data from Etherscan. The scheme has become common in the fast-growing DeFi sector.
Flash loans allow users to borrow funds without collateralization because the lender expects the funds would be returned instantly.
Warp Finance, which enables users to deposit crypto tokens in exchange for stablecoin loans, said in a tweet it was experiencing problems.
Warp Finance says it will replace most of the stolen funds from the collateral vault.
Hacker took advantage of the flash loan scheme and withdrew much higher than the collateral limit.
The stolen amount was in DAI and USDC vaults with a combined total of $7.7 million stolen.
Decentralized platform Warp Finance has suffered a major hack, as the newly launched company loses $7.7million worth of DAI and USDC stablecoins.
The hacker withdrew the said amount from the platform using a flash credit scheme. The loan scheme allows the users to get short-term loans without collateral as long as the loan is repaid immediately in one block. This is not the first time cybercriminals have used this handy feature to steal funds from platforms this year.