The incident underscores the importance of constant vigilance and proactive measures to protect the DeFi ecosystem, ensure the safety and integrity of DeFi platforms and their users’ funds as the space continues to grow.
The world of decentralized finance (DeFi) has been shaken once again as Deus Finance, a popular DeFi protocol, has suffered a major security breach. According to reports, the platform lost over $6 million due to a hack on its stablecoin DEI (DEI) on May 5th.
The attack was reportedly initiated by a bot that exploited a vulnerability in the Binance Smart Chain (BSC), resulting in a loss of more than $1.3 million. In addition, the attacker also targeted the Arbitrum network, causing deployments worth over $5 million in ARB/ETH to be lost.
The Deus team paused all contracts, confirmed the attack, and burned DEI tokens to prevent further damage in response to the attack. They also assured their users that they are currently comprehending the actual backing of DEI tokens and that a comprehensive recovery and redemption plan will be created after a full analysis of the balances and snapshots.
Unfortunately, this is not the first time that Deus Finance has suffered a security breach. The platform was previously exploited in a flash-loan attack in March 2022, which resulted in over $3 million in losses in Dai and Ether. During that incident, the exploiters reportedly used the crypto mixer Tornado Cash to funnel the stolen funds.
The loss of over $6 million is a major blow for Deus Finance, which is a decentralized marketplace that allows digital and non-digital assets, such as commodities, to be traded on the Ethereum blockchain. The DEI stablecoin is used as a collateral mechanism for third-party instruments built on the Fantom protocol. In the aftermath of the hack, DEI’s price has plummeted by 30%, dropping from its $0.30 peg to trade at $0.20 at the time of writing