DeFi Protocols Cream Finance, Alpha Exploited in Flash Loan Attack; $37.5M Lost
Alpha Finance says the "loophole" has been patched.
Decentralized finance protocols (DeFi) Cream Finance and Alpha Finance were victims of one of the largest flash loan attacks ever Saturday morning, resulting in a loss of funds totaling $37.5 million, according to transaction details on Etherscan.
Two hours later Cream Finance said its contracts were “functioning as normal” and markets had been enabled.
Alpha Finance then posted its own announcement, saying its Alpha Homora V2 product was the root cause. The company confirmed that it is working with DeFi guru Andre Cronje and Cream Finance to investigate the incident, and that the loophole had been fixed. It also said that they “have a prime suspect” in mind.
Earlier, Cream Finance tweeted an update on the incident saying that asset borrowing from its recently launched Iron Bank lending feature had been suspended. That tweet has since been deleted.
This is the second attack on a DeFi protocol in the last two weeks. Cronje's Yearn Finance suffered an an exploit in one of its DAI lending pools, according to the decentralized finance protocol’s official Twitter account. That exploit drained $11 million.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.