DeFi Platform Linear Finance In Crisis As LUSD Stablecoin Tanks To Zero After Exploit DeFi Platform Linear Finance In Crisis As LUSD Stablecoin Tanks To Zero After Exploit
Linear Finance has paused all protocol contracts and disabled the Linear budget contract.
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Updated: Sep. 22, 2023 at 11:20 am UTC
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DeFi protocol Linear Finance suffered an exploit yesterday, draining liquidity from its LUSD stablecoin.
The Linear Finance team confirmed the exploit, saying all LUSD liquidity on decentralized exchanges Ascendix and PancakeSwap was drained. The incident led to LUSD dropping to zero.
The protocol tweeted that it investigated the incident and asked users not to buy or trade the LUSD stablecoin.
What happened?
The exploit saw the attacker mint an unlimited supply of LAAVE and then trade the asset for LUSD on Linear Exchange. The exploiter sold the LUSD on PancakeSwap and Ascendix, removing all the liquidity.
Linear Finance claims that it is now investigating the incident and said it has shared the wallets that took part in the exploit with major exchanges and authorities so they can track the stolen assets.
“Restoring the protocol and un-doing the damage for our users will be our highest priority until the issue is fully resolved,” It added.
Following the incident, Linear Finance has paused all protocol contracts and disabled the Linear budget contract. It asked for users’ patience and support, promising to update regularly.
Performance of LUSD
LUSD stablecoin has fallen significantly in the last 24 hours. The token fell 100%, dropping to $0.0003760. LUSD was trading at $0.91 before the exploit. Although LUSD is a stablecoin, it has traded as high as $1.45 before now.
Meanwhile, Linear Finance’s LUSD should not be confused with Liquity Stablecoin (LUSD), currently trading at $0.99 per CoinMarketCap data.
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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.
