By James Davis
On Friday, hackers exploited the decentralized finance (DeFi) project Conic Finance stealing 1,705 ETH estimated to be worth $3 million. The protocol tweeted later that day, saying it was still investigating the vulnerability that led to the exploit.
According to blockchain security firm Beosin, the stolen ETH was transferred to a single address.
Launched in March 2023, Coin Finance is a protocol that allows users to earn rewards by depositing crypto assets into what it calls omnipools, which also serve as liquidity pools for decentralized exchange Curve.
Conic Finance Says Only the ETH Omnipool was Affected
Conic Finance reports that attackers only targeted the omnipool containing ETH and that others are safe. It has since disabled deposits to the affected pool.
Such exploits have been common in DeFi, a crypto sector aiming to provide traditional finance (TradFi) services like lending and borrowing using blockchain technology.
The protocols offering these services are still in the experimental stage, meaning they are filled with various vulnerabilities that hackers regularly exploit.
According to Chainalysis, a blockchain data company, 2022 recorded the most hacking incidents in the DeFi space. Some of the projects targeted that year include Ronin, Wormhole, and Nomad, each losing more than $300 million.
This Year’s Attacks on DeFi Protocols
From April to the end of June this year, DeFi investors lost at least $230 million, a 62% jump compared to a similar period in 2022. Immunefi blockchain security firm has reported that a significant percentage of the lost $230 million resulted from two incidents, including an Atomic Wallet hack on June 3 and a rug pull executed by now-fallen DeFi platform Fintoch on May 23.
At the time, Atomic Wallet users collectively lost $105 million to the notorious cybercriminal group Lazarus, while investors in Fintoch saw their combined $35 million investment disappear into thin air after the founders abandoned the project.
Meanwhile, Immunefi has also revealed that some blockchains were attacked more than others. For example, DeFi protocols based on Ethereum accounted for 65% of the lost amount. BNB Chain-based projects came in second with 21%, followed by protocols on the recently launched chain, Arbitrum, which accounted for 11%.