Decentralized finance (DeFi) protocol Platypus Finance said it had recovered 90% of the assets that were stolen in a security breach last week.
According to the October 17 announcement, the protocol’s net loss was limited to 18,000 AVAX (AVAX) worth $167,400 at the time of publication. As the hacker voluntarily returned the funds, Platypus Finance stated that it will “ensure that no legal action will be taken.” He also hinted that information about withdrawals related to users’ assets will be published soon.
On October 12, the automated market maker running on the Avalanche blockchain suffered three separate flash loan attacks that drained the protocol of $2.23 million. In 2021, the project raised $3.3 million in funding led by now-defunct crypto hedge fund Three Arrows Capital.
Since the most recent attack, Platypus has arrested all liquidity pools and is conducting a security audit. In a flash loan attack, a hacker exploits a vulnerability that allows them to instantly borrow crypto without providing the collateral necessary for the transaction. The hacker then withdraws the borrowed assets from the protocol, leaving a bad debt for users or the protocol’s treasury.
This was the third attack against Platypus this year, with a previous incident in July costing $157,000 via a flash loan attack and another, also a flash loan attack, which exploited the DeFi protocol for $8.5 million . After the February incident, Platypus stated in its recovery plan which would return at least 63% of users’ assets lost in the attack.
2/ Along with the recovery on October 12, more than 90% of the funds have been recovered. The net loss has been minimized to approximately 18,000 AVAX. We will post more information on the withdrawal agreement as we progress.
— Platypus (++) (@Platypusdefi) October 17, 2023
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