- Eurler Finance was targeted by a flash loan attack on 13 March, with the attacker successful in stealing assets worth $197 million.
- The ongoing attack has already become the largest hack of this year.
Ethereum-based noncustodial lending protocol Euler Finance was targeted by a flash loan attack on 13 March. The attacker was successful in stealing almost $197 million in Dai, USD Coin (USDC), staked Ether (StETH), and wrapped Bitcoin (WBTC).
Euler Finance acknowledged the exploit on Twitter and stated that it is currently working with cyber security and law enforcement professionals to resolve the issue.
We are aware and our team is currently working with security professionals and law enforcement. We will release further information as soon as we have it. https://t.co/bjm6xyYcxf
— Euler Labs (@eulerfinance) March 13, 2023
According to the most recent update, the exploiter stole nearly $197 million in multiple transactions.
Crypto analytic firm Meta Sleuth shared on Twitter that the attack was related to the deflation attack from a month ago. The hacker launched the attack today by using a multi-chain bridge to transfer funds from the BNB Smart Chain (BSC) to Ethereum.
Another prominent on-chain security expert, ZachXBT, noted that the movement of funds and nature of the attack appears to be very similar to black hats who exploited a BSC-based platform in February. The funds were transferred to Tornado Cash after exploiting a protocol on BSC a few weeks ago.
Last year, Euler Finance raised $32 million from San Francisco-based VC firm Haun Ventures in a funding round in which FTX, Coinbase, Jump, Jane Street, and Uniswap participated.
Euler Finance has become well-known over the year for its liquid staking derivatives (LSDs) services. These tokens allow investors to boost their potential returns by unlocking liquidity for staked cryptocurrencies such as Ethereum.
LSDs currently account for up to 20% of the total value locked in centralized finance protocols.
Largest crypto hack of 2023
The ongoing attack has already become the largest hack of this year.
Decentralized finance (DeFi) exploits occur when hackers take advantage of an open-source platform’s code to gain unauthorized access to its assets and exploit them. DeFi attacks are one of the most serious issues confronting the crypto industry.
In 2022, over $3 billion was stolen from DeFi protocols via hacks or exploits, according to blockchain analytics firm Chainalysis. 2022 was the biggest year ever for crypto hacking, with $3.8 billion stolen from cryptocurrency businesses.
DeFi protocols as victims accounted for 82.1% of all cryptocurrency stolen, that is, a total of $3.1 billion, by hackers in 2022.