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With ongoing research reports in the decentralized finance (DeFi) sector, opportunities and threats continue to emerge in this industry. However, the increasing number of hack attacks in this field is causing a decrease in interest in DeFi. Recently, after a security breach in Platypus Finance, 90% of the stolen assets were recovered.
Statement from the Team
According to an announcement made by the Platypus Finance team on October 17, the protocol’s net loss was limited to 18,000 AVAX, which is worth $167,400. The team also revealed that the hackers voluntarily returned the funds and stated that no legal action would be taken regarding the matter.
The developers also announced that withdrawal information regarding users’ assets would be shared with the public soon. In the attack that took place on October 12, $2.23 million worth of crypto assets were stolen from the protocol, which provides automatic market-making services on the Avalanche blockchain network, and the hack attack was carried out using three different flash loan methods.
Platypus Not Targeted for the First Time
In 2021, a total of $3.3 million was raised under the leadership of the crypto hedge fund Three Arrows Capital, which declared bankruptcy in previous months. Since the recent attack, Platypus developers have halted all liquidity pools and decided to continue security audits. This audit is still ongoing.
In a flash loan attack, the hacker takes advantage of a security vulnerability that allows instant borrowing of crypto assets without providing the necessary collateral. The hacker then withdraws the borrowed assets from the protocol, leaving a debt that should be assumed by the users or the protocol treasury.
This attack is recorded as the third attack against Platypus this year. In a previous incident in July, $157,000 was seized using the flash loan attack method, followed by an attack that resulted in the withdrawal of $8.5 million worth of crypto assets from the DeFi protocol. After the incident in February, Platypus claimed that it would refund at least 63% of the lost assets through a recovery plan.
