Hackers have successfully exploited the smart contracts of Yield Protocol, a defunct decentralized finance (DeFi) lending protocol. Yield Protocol ceased operations in December 2023 due to a lack of business demand and regulatory pressures. Users were repeatedly urged to close their positions, withdraw funds, and settle any outstanding loans. Despite these warnings, an unidentified hacker managed to steal around $181,000 worth of cryptocurrency from Yield’s strategic contracts on the Arbitrum blockchain.
The initial news of the hack came from PeckShield, a blockchain investigation firm, and was later confirmed by CertiK. CertiK’s subsequent investigation revealed that the attacker took advantage of a discrepancy between the pool token balance and the total supply by carrying out flash loans and withdrawing additional pool tokens. Yield Protocol officially ended its support on February 2, and although it had experienced a resurgence in the past, prospects for recovering the stolen funds currently seem bleak.
This is not the first time Yield Protocol has faced such a situation. In March 2023, it was among ten DeFi protocols that suffered losses as a result of an attack on the noncustodial lending protocol Euler Finance. By July 2023, Yield Protocol had managed to fully recover from the Euler flash loan attack. During this time, the protocol collaborated with Euler to deploy new contracts and execute permissioned calls in order to restore token maturities and revive the protocol.
On a more positive note, blockchain security firm Immunefi recently reported a decline in losses due to hacking and scams in the first quarter of 2024 compared to the previous year. In Q1 of 2024, approximately $336.3 million was lost to hacking and fraudulent activities, a 23% decrease from the same period in 2023 when losses amounted to $437.5 million. The report identified 46 hacking incidents and 15 cases of fraud. Among the victims, Orbit Bridge, a cross-chain bridge protocol, suffered the largest loss of $81.7 million.
This unfortunate incident emphasizes the importance of educating users about the risks involved in DeFi and the need to stay vigilant. Let’s all work together to build a more secure and resilient ecosystem.
This news just reinforces the negative perception of DeFi in the mainstream. 🙅♂️
It’s unfortunate that Yield Protocol had to go through this challenging situation once again. However, their previous experience of recovery gives hope for a potential bounce back.
Yield Protocol’s closure was already a sign of trouble, and this hack just confirms it. 🚫
I can’t believe they didn’t take the warnings seriously and secure their funds before shutting down. 🤬
This news serves as a reminder for everyone involved in the crypto space to prioritize security. 🚀 It’s crucial to stay updated on the latest security protocols and best practices to protect our funds. 🛡️💪
It’s unfortunate that Yield Protocol faced another hack, especially after their previous recovery efforts. 😔 I hope they can find a way to bounce back once again and regain users’ trust. 💪🚀
When will these protocols finally prioritize security over everything else? 🛡️