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Yearn.finance pleads arb traders to return funds after $1.4M multisig mishap

A Yearn contributor said the value lost came from “strictly protocol owned liquidity” in the protocol’s treasury and that customer funds weren’t impacted.

Decentralized finance protocol Yearn.finance is hoping arbitrage traders will return $1.4 million in funds after a multisignature scripting error, resulting in a large amount of the protocol’s treasury being drained.

“A faulty multisig script caused Yearn's entire treasury balance of 3,794,894 lp-yCRVv2 tokens to be swapped,” according to a Dec. 11 GitHub post by Yearn contributor “dudesahn.”

The error occurred while Yearn was converting its yVault LP-yCurve (lp-yCRVv2) — earned from performance fees on vault harvests — into stablecoins on decentralized exchange CowSwap.

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Ethereum-Based Decentralized Exchange dYdX Suffers $9,000,000 Loss in an Alleged ‘Market Manipulation Attempt’

Ethereum-Based Decentralized Exchange dYdX Suffers ,000,000 Loss in an Alleged ‘Market Manipulation Attempt’

An Ethereum-based (ETH) decentralized exchange (DEX) has suffered millions of dollars in losses after an alleged market manipulation attempt by a rogue user. In a new thread on the social media platform X, the DEX protocol dYdX says that $9 million from its insurance fund was used to fill gaps in liquidations processed in the […]

The post Ethereum-Based Decentralized Exchange dYdX Suffers $9,000,000 Loss in an Alleged ‘Market Manipulation Attempt’ appeared first on The Daily Hodl.

Pakistan Digital Currency Reforms Set Path for CBDC as Legal Tender

Crypto Whales Sell Off Ethereum (ETH)-Based Altcoin Before Massive 40% Correction: On-Chain Data

Crypto Whales Sell Off Ethereum (ETH)-Based Altcoin Before Massive 40% Correction: On-Chain Data

Crypto whales sold off millions of dollars worth of yearn.finance on Saturday prior to YFI sharply correcting by over 40%, according to on-chain data. Spotted by blockchain-tracking firm Lookonchain, one wallet deposited the better part of $5.8 million worth of YFI to crypto exchanges, likely to be sold off on the open market. “Why did […]

The post Crypto Whales Sell Off Ethereum (ETH)-Based Altcoin Before Massive 40% Correction: On-Chain Data appeared first on The Daily Hodl.

Pakistan Digital Currency Reforms Set Path for CBDC as Legal Tender

dYdX founder claims targeted attack led to $9M insurance claim

dYdX founder Antonio Juliano said that the decentralized exchange as well as the Yearn.Finance token (YFI) are victims of a targeted attack.

Decentralized exchange (DEX) dYdX was forced to use its insurance fund to cover $9 million in user liquidations on Nov. 17. According to dYdX founder Antonio Juliano, the losses resulted from a "targeted attack" against the exchange. 

Based on reports from the dYdX team on X (formerly Twitter), the v3 insurance fund was used "to fill gaps on liquidations processes in the YFI market." The Yearn.Finance (YFI) token dropped 43% on Nov. 17 after soaring over 170% in the previous weeks. The sudden price crash raised concerns within the crypto community about a possible exit scam.

The alleged attack targeted long positions in YFI tokens on the exchange, liquidating positions worth nearly $38 million. Juliano believes trading losses affecting dYdX, as well as the sharp decline in YFI, have been caused by market manipulation:

"This was pretty clearly a targeted attack against dYdX, including market manipulation of the entire $YFI market. We are investigating alongside several partners and will be transparent with what we discover."

According to Juliano, the v3 insurance fund still holds $13.5 million, and users' funds were not affected by the incident. "Even though no user funds were affected, we will also be conducting a thorough review of our risk parameters and making appropriate changes to both v3 and potentially the dYdX Chain software if necessary,” he noted on X.

Balance changes on dYdX's insurance wallet. Source: DYDX Explorer

The profitable trade wiped out over $300 million in market capitalization from the YFI token, leading the community to raise eyebrows about a possible insider job in the YFI market. Some users claimed that 50% of the YFI token supply was held in 10 wallets controlled by developers. However, Etherscan data suggests some of these holders are crypto exchange wallets.

Cointelegraph reached out to dYdX and Yearn.Finance's teams for comment and is awaiting a resoonse.

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Pakistan Digital Currency Reforms Set Path for CBDC as Legal Tender

Yearn.Finance token tumbles 43%, community speculates on exit scam

Yearn.Finance's YFI token crashed over 43% in just five hours, after rallying almost 170% in November.

Yearn.Finance's governance token (YFI) plummeted over 43% in just five hours on Nov. 18 after rallying almost 170% early in the month, stirring fears about a possible exit scam. 

During the dramatic drop in value, over $300 million was wiped out in market capitalization from November's gains, according to data from CoinMarketCap. At the time of writing, the YFI token is trading at $9,069 from $14,185 a day before. However, the token is still up 83% over the past 30 days.

The sell-off has triggered another weekend of fear, uncertainty and doubt (FUD) within the crypto community. On X (formerly Twitter), some users claim that 50% of the token supply was held in 10 wallets controlled by developers. However, Etherscan data suggests that some of these holders may be crypto exchange wallets.

YFI token holders on Nov. 18, 2023. Source: Etherscan 

In addition, some X's users pointed out that opening short positions may have triggered the move. Data from Coinglass shows a jump in YFI open interest, indicating that traders are shorting the coin after November's gains.

"I bought the dip… someone sold 1000 coins perhaps that’s why it dropped massively. Will see," commented a trader on X. According to another user, YFI's price movement after the decline is unusual for exit scams:

"Doesn’t look like rugpull at all. Cuz inspite if so much sell off price is still stable at 9k which is 80% above its bottom."

Yearn.Finance is a decentralized finance (DeFi) protocol that provides automated trading solutions for DeFi markets. Andre Cronje, an Ethereum developer and entrepreneur, launched the protocol in July 2020. Cointelegraph reached out to Cronje and Year.Finance but did not receive an immediate response.

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Pakistan Digital Currency Reforms Set Path for CBDC as Legal Tender

Ethereum-Based DeFi Altcoin Explodes Amid New Spike in Whale Activity: Analytics Firm Santiment

Ethereum-Based DeFi Altcoin Explodes Amid New Spike in Whale Activity: Analytics Firm Santiment

An Ethereum (ETH)-based decentralized finance (DeFi) protocol has exploded in price amid a recent spike in whale activity and new addresses, according to the crypto analytics firm Santiment. YFI, the native asset of automated yield-farming protocol Yearn.Finance, is trading at $10,242 at time of writing. Santiment notes that the number of YFI transactions valued at […]

The post Ethereum-Based DeFi Altcoin Explodes Amid New Spike in Whale Activity: Analytics Firm Santiment appeared first on The Daily Hodl.

Pakistan Digital Currency Reforms Set Path for CBDC as Legal Tender

Euler attack causes locked tokens, losses in 11 DeFi protocols, including Balancer

On March 8, Euler had over $311 million in crypto locked inside its smart contracts. Its total value locked has since fallen to $10.37 million.

Contagion from the Dec. 12 flash loan attack against Euler has spread far and wide, resulting in frozen or lost funds for 11 different decentralized finance (DeFi) protocols, according to Dec. 13 reports from each of them on Twitter. Balancer, an Ethereum protocol with over $1 billion total value locked (TVL), is among the affected protocols. Below is a rundown of the major exploits and what we know so far.

Balancer

Balancer reported on March 13 that the Euler Boosted USD (bb-e-USD) pool had been affected by the exploit. Approximately $11.9 million worth of tokens from this pool were sent to Euler during the exploit. The balancer emergency subDAO reacted by pausing the pool and putting it into recovery mode. However, over 65% of the pool’s TVL had already been lost by the time it was paused.

As a result of a bug in the app’s user interface (UI), liquidity providers cannot retrieve the remaining funds left in the pool. However, a new UI will be offered “in the near future” that will allow the remaining funds to be withdrawn, Balancer said. No other pools have been affected, Balancer clarified.

Angle Protocol

Angle Protocol released a preliminary report on its exposure to the attack. It may have lost over $17 million worth of USD Coin (USDC). This may have caused the agEUR stablecoin, which is pegged to the euro, to become undercollateralized. The team is still investigating and attempting to prepare a detailed balance sheet. All minting and redemption of agEUR is currently paused, but borrowers can still repay their debts to the protocol as normal, the team said.

Idle Finance

Idle Finance has provided a detailed list of its losses due to the Euler exploit. It seems to have lost around $5.9 million worth of tokens in total, based on March 13 Ether (ETH) and euro prices. The team has paused all Best Yield vaults and Yield Tranches related to Euler to prevent further losses.

Yearn Finance

Yearn Finance has over $423 million in TVL, according to DeFi Llama. It reported indirect exposure to Euler, through Angle Protocol and Idle Finance. It has lost approximately $1.38 million. However, the team said that any bad debt not covered by Idle and Angle would be covered by the Yearn Treasury.

Yield Protocol

Yield Protocol is another protocol affected by the exploit. Its "mainnet liquidity pools are built on Euler," according to the team's announcement regarding the attack. The company has disabled the mainnet app, paused borrowing, and is investigating the attack. Its mainnet liquidity pools appear to have been affected, with a possible loss of “less than $1.5 million.”

InverseFinance

InverseFinance reported that it was hit as well. It's DOLA Fed for the DOLA-bb-e-USD on Balancer lost over $860,000. The team said it is communicating with Balancer in an attempt to get these funds returned to depositors.

Related: Euler Finance hacked for over $195M in a flash loan attack

SwissBorg

SwissBorg reported that “a small portion of [its] Smart Yield Program was impacted” by the exploit. However, “the extent of the damage is minimal thanks to our Risk Management Procedure.” The team said that it would compensate all losses from its funds, and its users “will not suffer any loss from this event.”

In a Telegram conversation with Cointelegraph, SwissBorg founder Cyrus Fazel clarified that the protocol ranks yield strategies based on risk, time, and APY. Since Euler was rated Risk 2- Adventurous, SwissBorg users “had a limited amount” invested in Euler. This mitigated against losses to the protocol, he explained.

Other affected protocols

Opyn, Mean, Sense and Harvest also reported they might have been affected by the exploit, though none have provided details on how much has been lost. This brings the total number of affected protocols to 11, with $37.6 million in cumulative losses. 

Euler Finance is a crypto borrowing and lending protocol that runs on Ethereum. It became popular thanks in part to its support for using liquid staking derivatives (LSDs) such as Coinbase Staked ETH (cbETH) or Lido Staked ETH (stETH) as collateral for loans. On March 8, Euler had over $311 million in crypto locked inside its smart contracts. Since the exploit, its TVL has fallen to $10.37 million.

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DeFi protocols unite to promote permissionless Web3 experiences

The collaboration of over 30 DeFi projects came as an effort to counteract the negative sentiments built in 2022 due to numerous CeFi ecosystem crashes.

The damages caused by the fall of major crypto ecosystems in the last year are on a path of steady recovery as good actors take proactive measures to rebuild trust among investors. Major players from the decentralized finance (DeFi) ecosystem came together to showcase the incentive behind operating trustless, interoperable and permissionless platforms.

For 24-hrs from Feb.6 to 7, over 30 DeFi protocols joined in an initiative to “permissionlessly” share tweets from other protocols — thus highlighting the permissionless and interoperable nature of Web3. Projects participating in this campaign include Yearn, MakerDAO, SushiSwap and Aave, among others.

DeFi has amassed mainstream acceptance with significant institutions making their entrance into the space, it still has a shaky reputation due to its many exploits.

Mamun Rashid, the chief marketing officer at MakerDAO, said that in order to realize the “full potential” of DeFi there needs to be a collaboration between the ideas and expertise that exist in the space.

“Together, we can push the boundaries of traditional finance and build a more inclusive and accessible financial system through DeFi."

The projects collaborating in the campaign defined the “spirit” of DeFi as a more collaborative ecosystem, rather than a competitive one.

Jared Grey, the CEO of SushiSwap said DeFi is being built to challenge the current status quo of known financial frameworks, which historically create barriers and reduce economic freedom.

“Leveraging the composability of this new technology, we can democratize and provide more equitable, safer, and transparent financial tools and products to reach a global audience.”

Grey said the responsibility to portray the true message of DeFi comes first from within the space. Therefore, the initiative and solidarity of more than 30 builders within the space comes at a critical time.

Related: DeFi should complement TradFi, not attack it: Ava Labs CEO | Davos 2023

Over the last year, the DeFi space was a major target for exploits. According to a report from Beosin, DeFi-based projects received the highest number of attacks in 2022.

This vulnerability led to a 47.4% rise in security losses in 2022 compared to the previous year, which totaled $3.64 billion in losses.

Additional industry insights revealed that the trend of DeFi exploits should be expected to continue into this year due to new projects entering the market and more sophisticated hackers.

Nonetheless, the space started the year off with significant growth, according to a DappRadar report. In January, a new $150 million ecosystem fund was created by Injective to boost DeFi and Cosmos adoption. 

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Yearn​.finance opens vault deployment access to all users

“All factory-deployed vaults have no management fees and a flat 10% performance fee,” the DeFi project wrote.

Decentralized yield protocol Yearn.finance said in a Jan. 9 tweet that all users can now create sophisticated Permissionless Vault Factories on its platform. The current version of Vault Factory works with stablecoin-swapping platform Curve Finance and its liquidity provider (LP) tokens and features three premade yield strategies.

“Our new Permissionless Vault Factory lets anyone deploy an auto-compounding yVault for any Curve pool with an active liquidity gauge. Yes, anyone. Factory-deployed vaults have no management fees and a flat 10% performance fee. Nice!”
Cast your vote now!

As told by Yearn.finance, the first, dubbed “Boosted Factory,” uses Yearn’s vote-escrowed CRV balance of 45.1 million to give users a maximum boost of 2.5x on CRV rewards. The second, “Convex Factory,” supplies additional CRV LP tokens beyond the maximum to the decentralized platform Convex Finance to earn CRV and CVX rewards. Finally, “Convex Frax Factory" enables users to access rewards on the Frax Share algorithmic stablecoin platform.

“In all three strategies, any earned tokens are regularly claimed, sold for more of the underlying Curve LP token, and then deposited back into the strategy to compound the yield.”

Yearn.finance stated that the Vault Factory represents a “massive” step forward in automation that allows the firm to reduce its cost of operations. All vaults deployed using the new method will incur a management fee of 0% and a performance fee of 10%. Previously, management and performance fees were 2% and 20%, respectively. Performance fees go to the Yearn treasury and are calculated on top of profits. In addition, the deposit and withdrawal fees are also set at 0% for the new self-created vaults, although gas fees are still incurred during interactions.

Pakistan Digital Currency Reforms Set Path for CBDC as Legal Tender

Is the Crypto Bottom In? Analytics Firm Santiment Says One Metric Is Flashing a Historically Bullish Signal

Is the Crypto Bottom In? Analytics Firm Santiment Says One Metric Is Flashing a Historically Bullish Signal

The leading crypto analytics firm Santiment says one metric they track is signaling a bullish turn in the market based on historical performance. According to Santiment, fear, uncertainty and doubt (FUD) are reaching peak levels as determined by the prevalence of negative crypto terms such as “sell” across several social media platforms. Using their social […]

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Pakistan Digital Currency Reforms Set Path for CBDC as Legal Tender