Welcome to Finance Redefined, your weekly dose of essential decentralized finance (DeFi) information – a newsletter designed to bring you meaningful developments over the past week.
The backlash from the Terra implosion still haunts the cryptocurrency world, and stablecoin performance platform Stablegains, now shut down, is being sued for customer losses. The plaintiffs allege that the platform funneled client funds into the Anchor Protocol without the knowledge or consent of the users.
Platypus, the DeFi protocol that was mined for more than $8 million, is working on a compensation plan to recover part of the funds.
Cogent Bank of Florida is proposing a $100 million participation in loans for the MakerDAO RWA Master Participation Trust.
Bridging protocols were the main target of exploits last year, amounting to hundreds of millions of dollars in stolen funds. Trustless bridging can mitigate the problem, allowing cross-chain transfers without the need for a centralized custodian, which could make it a more secure option for interop.
After almost four weeks of a bull run, the DeFi market is waging a valiant battle against the bears. There were minor price declines, and the overall market eased slightly as the bears had the upper hand towards the end of the week.
Stablegains performance platform sued for promoting UST as a ‘safe’ investment
DeFi performance platform Stablegains is being sued in a California court for allegedly misleading investors and failing to comply with securities laws.
On February 18, the plaintiffs, Alec and Artin Ohanian, filed a lawsuit in the United States District Court for the Central District of California, alleging that the closed DeFi platform diverted all of its client funds to the Anchor Protocol without their consent. knowledge or consent. Anchor Protocol offered up to a 20% return on Terraform Labs’ algorithmic stablecoin Terra USD (UST).
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Platypus to work on compensation plan after $8.5M attack
The $8.5 million Platypus flash loan attack was made possible by code that was in the wrong order, according to a post-mortem report by Platypus auditor Omniscia. The DeFi firm is working on a compensation plan for user losses after a flash lending attack drained nearly $8.5 million from the protocol, affecting its peg to the stablecoin’s dollar.
In a February 18 tweet, Platypus said it was working on a plan to compensate for the damages and asked users not to realize their losses in the protocol, saying this would make it more difficult for the company to handle the issue. Asset liquidations are also on pause, the protocol says.
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MakerDAO Votes on $100M Loan Participation with Florida Commercial Bank
Crypto lending platform MakerDAO is voting on a new proposal to add another commercial bank to its ecosystem, strengthening the connection between DeFi and traditional finance.
According to the MakerDAO governance forum, Cogent Bank, a Florida-based commercial bank, is proposing to participate with $100 million in loans for MakerDAO’s RWA Master Participation Trust.
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DeFi Security: How Trustless Bridges Can Help Protect Users
Blockchain bridges allow DeFi users to use the same tokens across multiple blockchains. For example, a merchant can use USD Coin (USDC) on the Ethereum or Solana blockchains to interact with decentralized applications on those networks.
While these protocols may be convenient for DeFi users, they are at risk of being exploited by malicious actors. For example, last year the Wormhole Bridge, a popular cross-chain crypto bridge between Solana, Ethereum, Avalanche, and others, was hacked, with attackers stealing more than $321 million worth of wrapped Ethereum (wETH), the largest ever hack ever. in DeFi history of the time.
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DeFi Market Overview
Analytical data reveals that the total DeFi market value fell below $50 billion last week. Data from Cointelegraph Markets Pro and TradingView shows that the top 100 DeFi tokens by market cap had a mixed week, with most tokens trading in the green while a few others bled red.
Thanks for reading our roundup of this week’s most impactful DeFi developments. Join us next Friday for more stories, ideas, and education in this dynamic forward space.
