DeFi protocol Arcadia Finance has suffered a hack, losing $455,000 in the process.
The Exploit Was Made Possible by Flaws in Arcadia's Code
DeFi protocol Arcadia Finance has suffered a hack, losing $455,000 in the process.
The exploit, according to blockchain security company PeckShield, was made possible by flaws in Arcadia's code. According to PeckShield, the Optimism exploiter transferred 180 Ether ($305,000) and washed most of it through Tornado Cash, but the Ethereum exploiter stole about $100,000 and left it in the wallet.
Since the protocol attack, Arcadia Finance's total value locked has dramatically decreased by 76%, from $605,000 to $144,000. The company claims that Arcadia Finance is susceptible to further vulnerabilities since there is no reentrancy protection, which would prevent immediate liquidation from disabling the internal vault health check.
The breach occurred amid a surge of DeFi exploits in the first half of 2023. However, the amount of money lost in the DeFi sector has significantly decreased. Arcadia Finance has made contact with the attacker and is attempting to resolve the situation with the assistance of its security partners, law enforcement and the larger community.
