Indexed Finance, a decentralized financial platform that lost $ 16 million in a cyber attack, intends to compensate users.
Hacker exploited DeFi vulnerability on October 15th with quick loans mechanism
rebooted protocol with new assets. This move lowered the price of indexed tokens, which allowed the attacker to issue new ones and cash them out. As a result, two of the six assets in the DEFI5 and CC10 protocol (index tokens that track major DeFi) have lost most of their value. Indexed Finance spokesman Laurence Day said that the sixth asset, the FFF meta-index, was badly damaged and would have to be removed. The other three index tokens DEGEN, NFTP and ORCL5 were not damaged during the cyber attack. In the near future, the company will draw up a plan to compensate the assets of the site users.
According to Lawrence Day, the hacker was identified on October 15, because “he acted inaccurately.” On October 16, the Indexed Finance team issued an ultimatum to the attacker and gave time to return the assets until midnight. If they refused, they threatened to disclose the name of the offender and send information about his actions to law enforcement agencies. On October 17, a hacker under the nickname ZetaZeroes contacted them. The attacker qualified his attack as arbitration and stated that he could not be found. “You lose. If your team and token investing clients made the effort to understand how Balancer pools work, you could beat me. ”
Lawrence claims the platform doesn’t know what to do next. The hacker’s handwriting suggests that the company is dealing with a minor. Lawrence did not say whether they are in further negotiations with the hacker and whether they are going to apply to law enforcement agencies. A DAO member lamented that the industry is too young, and therefore subject to constant hacks. According to him, the DeFi field lacks auditors to prevent cyberattacks and added that “the talent pool in this area is extremely small.”
Indeed, there are one, two, or even more high-profile DeFi platform hacks every month. Bitwise CFO Matt Hogan believes the industry is so young.
At the same time, cybersecurity companies have learned how to recover funds stolen from DeFi. Recently, the cybersecurity group Lossless returned the assets stolen from DeFi to Cream Finance and offered a tool to identify vulnerabilities.
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