Decentralized finance (DeFi) protocol dYdX founder Antonio Juliano took to X (previously Twitter) to share a few of the findings of the investigation into the lack of $9 million in insurance coverage funds, in what many suspected was an exit rip-off, that passed off on Nov. 17.
Juliano famous that the precise dYdX chain wasn’t compromised, and the insurance coverage claims of $9 million passed off on the v3 chain. The v3 insurance coverage fund was used to fill gaps in liquidation processes within the YFI market.
The protocol co-founder additionally harassed that dYdX has no plans to barter with the exploiters behind the assault and can as a substitute pay bounties to these most useful in aiding the investigation:
“We is not going to pay bounties to, or negotiate with the attacker. We and others have made vital progress into figuring out the attacker. We’re within the means of reporting the knowledge we’ve to the FBI.”
Juliano added that the v3 chain that was exploited has central parts that may very well be one of many potential causes behind the compromise. The safety incident drove the Yearn.finance token to drop by 43% on Nov. 17. The sudden worth crash raised considerations throughout the crypto neighborhood a couple of potential exit rip-off.
To be very clear: the latest insurance coverage fund incident on dYdX was on v3 and never the dYdX Chain
v3 has central parts, dYdX Chain doesn’t. We assist to function v3, we don’t assist to function dYdX Chain. That is vital to grasp why we’ve taken the actions we’ve
— Antonio | dYdX (@AntonioMJuliano) November 20, 2023
The exploit on Nov. 17 focused lengthy positions in YFI tokens on the trade, liquidating positions price almost $38 million. This was one of many key catalysts behind the value drop of the YFI token. The trade-in query worn out over $300 million in market capitalization from the YFI token, additional fueling the insider job principle.
Safety breaches in DeFi are nothing new; nonetheless, what makes this incident completely different is the truth that dYdX is concentrated on discovering the offender utilizing the neighborhood quite than paying a direct bounty to the exploiters.
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