Balancer suffers breach despite prior warnings; TVL falls $164M Balancer suffers breach despite prior warnings; TVL falls $164M
Balancer's TVL has declined by nearly 20% to $676.47 million from $840 million, according to DeFillama data.
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Updated: Aug. 28, 2023 at 1:52 pm UTC
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Decentralized exchange Balancer confirmed that its V2 pools were exploited for an undisclosed sum despite its previous warning about vulnerabilities.
In an Aug. 27 post on its official X account, the Ethereum-based protocol revealed that its mitigation procedure was able to minimize the impact of the exploit. However, users are advised to withdraw their funds from the affected pools to prevent further attacks.
Cyvers Founder Meir Dolev claimed that about $900,000 was stolen from the exploit, adding that more than $600,000 has been moved into a new address. An address linked to the hacker also contains over $979,000 worth of DAI tokens, which it received in three transactions.
On Aug. 22, Balancer said a vulnerability affecting several of its pools put about 4% of the total value of assets locked (TVL) on its platform at risk. At the time, the protocol claimed that 80% of the issue had been mitigated but urged users to remove their funds from the affected pools.
โWe believe funds in the mitigated pools (labeled โmitigatedโ) are safe, but nevertheless strongly recommend timely migration to safe pools, or withdrawal. Pools that could not be mitigated are labeled โat risk.โ If you are an LP in any of these pools, please exit immediately,โ it added.
Balancer TVL falls by $164M
Over the last seven days, Balancer’s TVL has declined by nearly 20% to $676.47 million from $840 million, according to DeFillama data. This means the DeFi protocol users have withdrawn roughly $164 million of assets from the platform since the vulnerability fears emerged.
DeFillama data reveals a rapid drop in TVL, shedding over $200 million within 24 hours, settling at $638.8 million following the protocol’s confirmation of a pool vulnerability.
Despite the protocol’s claim that it has mitigated the risks, user trust in the platform continues to wane, with a mere $38 million inflow since the incident.
Meanwhile, Balancer’s vulnerability fears emerged on the heels of an exploit on Curve that resulted in over $60 million in losses and posed a contagion threat to numerous DeFi platforms.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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