After an attack this morning, the DeFi protocol Euler Finance lost nearly $197 million in cryptocurrencies. This makes it the biggest hack of 2023 so far.
DeFi Euler Finance protocol under attack
In the morning, the decentralised finance protocol (DeFi) Euler Finance was alerted by PeckShield, about a transaction that may have resulted from a hack on its application:
Hi @eulerfinance: you may want to take a look: https://t.co/L7ddZhHNq5
– PeckShield Inc (@peckshield) March 13, 2023
Within an hour, the protocol teams confirmed the attack, and the following information banner has since appeared on the Euler Finance website, pending further information:
“We are aware of an issue affecting our platform at this time. Our team is currently working with security and law enforcement professionals. Please monitor our Discord and Twitter channels for updates. “
Nearly 197 million in stolen funds
The amount of the theft is said to be $196.98 million, according to data collected by various on-chain analysts. For its part, the company BlockSec has created a shared Google Seets file in which it details all the stolen funds. The biggest haul includes nearly 74,000 stETH:
Details of stolen funds on Euler Finance protocol
This attack was carried out using a flash loan of 30 million IADs borrowed from Aave. A flash loan, or instant loan, is a transaction that allows large amounts of funds to be borrowed to carry out a particular transaction and then repaid in a single transaction.
According to PeckShield’s initial analysis, the flaw stems from poor code construction logic in the part that oversees the collateralisation of investors borrowing on the platform. More precisely, it would be a problem in a function called “donateToReserve”:
2/ The hack is made possible due to the flawed logic its donation and liquidation. Specifically, the donateToReserves needs to ensure the donator is still over-collateralized. And liquidation needs to ensure the *correct* conversion rate from borrow to collateral asset. pic.twitter.com/dsHUP1orRP
– PeckShield Inc (@peckshield) March 13, 2023
According to the information available, the Euler Finance attack is the biggest hack of 2023 so far. The amount of funds stolen places this attack in 6th place in the ranking of various hacks in the crypto ecosystem.
