Defrost Finance Drained for $12M – Flash Loan Attack or Rug Pull?

DeFi criminals person been observed to currency successful connected the ‘spirit of giving.’

Decentralized concern protocol Defrost Finance became the latest unfortunate of a flash indebtedness onslaught connected December 23rd that drained funds successful the V2. The attacker utilized the proprietor cardinal for the 2nd clip to exploit V1.

• According to the Twitter thread by Defrost Finance, the squad is presently consenting to negociate with the individuals down the onslaught and sermon sharing 20% of the funds successful speech for the bulk of assets.
• However, Peckshield said it received a “community intel” informing claiming that it was really a rug propulsion of Defrost Finance. The researcher found that the stock terms of LSWUSDC was manipulated, which resulted successful a $173,000 nett for the hacker.
• Further analysis shows the summation of a fake collateral token and a malicious terms oracle that was utilized to liquidate existent users.
• The nonaccomplishment is estimated to beryllium astir $12 million.
• Typically, successful lawsuit of a rug pull, the squad down the task goes soundless connected societal media.
• Defrost Finance’s halfway squad subordinate Doran, connected the different hand, confirmed the flash indebtedness that deed v2 was closed down for investigation. v1 was not impacted by the hack.

“We volition support connected investigating and each applicable accusation volition beryllium shared with the community. We are thankful to the Defrost assemblage for their ongoing enactment astatine this hard clip Our precedence remains to retrieve the funds.”

• UPDATE: Hours aft the exploit took place, the squad down the task said it has recovered each the funds.

The hacked funds person been returned to #DefrostFinance.

The affected users volition precise soon beryllium capable to assertion their assets back.

Details 👇https://t.co/RpDqKAK44y

— Defrost Finance 🔺 (@Defrost_Finance) December 26, 2022