A hacker withdrew $6 million from the Deus Finance DeFi protocol by breaching the security of the DEI algorithmic stablecoin.
Hi @DeusDao: it appears to be a pubic burn vulnerability with loss > $1.3M alone at BSC. The ARB/ETH deployments are also affected.
The BSC hack was successfully frontrun by a bot: https://t.co/hXskQOIfwV
The DEI token @ BSC was upgraded on Apr-10-2023 https://t.co/QJHwnZaXMk pic.twitter.com/C51CnVsg1B
— Peck Shield Inc. (@peckshield) May 5, 2023
According to PeckShield analysts, on May 5, an attacker used an exploit on the BNB Smart Chain (BSC) and Arbitrum networks.
The hacker launched a bot in BSC, which led to a loss of more than $1.3 million. After that, he attacked Arbitrum – when deploying ARB / ETH, the hacker withdrew more than $5 million.
Protocol representatives confirmed the incident and announced the suspension of smart contracts. The project team also burned DEI tokens on affiliated chains to prevent further damage.
Update on DEI tokens security breach
Yesterday:
In response to the security breach, all contracts were paused, and DEI tokens on chains were burnt to prevent further damage— DEUS (@DeusDao) May 6, 2023
Deus Finance took pre-burn balance shots to offer users a compensation plan after the restoration of work.
“Users are advised to remain patient and not interact with current DEI contracts until a specific repayment plan is available,” the project added.
The DEI stablecoin is used as a collateral mechanism for third-party instruments built on the Fantom protocol. Against the background of the hack, the price of the asset fell by more than 30% – from $0.3 to $0.2. According to CoinMarketCapat the time of writing, DEI has recovered slightly and is trading at $0.26.
On May 15, 2022, DEI lost its peg to the US dollar amid the collapse of the UST stablecoin and the collapse of the Terra ecosystem.
In March, an attacker attacked Deus Finance DAO using instant loans. Its production amounted to about $3 million.
Later, the project was attacked again – the hacker withdrew assets worth approximately $13.4 million from smart contracts.
Recall, according to a report by the analytical company CertiK, in April 2023, cryptocurrency projects lost $103.7 million due to exploits, hacks, and exit scams. The cumulative loss since the beginning of the year amounted to $429.7 million.
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