Although decentralized finance (DeFi) has been billed by many as the future of money, the vulnerability of DeFi protocols has remained a dint in the image of the nascent sector.
A week after it was reported that Qubit Finance had lost $80 million in a hack, network bridge protocol, Wormhole, has become the latest victim in the increasingly worrying trend of defi hacks.
Wormholes Lose $320 Million to a Solved Problem
Wormhole is a communication bridge network between Solana, Ethereum, and other top decentralized finance (DeFi) networks. The protocol currently has over $1 billion in its TVL.
On February 2, at 9:42 PM, the Wormhole team announced its network was temporarily down for maintenance as they were looking “into a potential exploit.”
Two hours later, the Wormhole team announced that the hacker made away with 120,000 wETH, or wrapped Ether worth approximately $320 million, making it the second-largest defi hack to date.
On the Flipside
- Wormhole has pledged to add ETH to its pool to ensure the wETH is backed one-for-one and get the network back up. It tweeted;
The wormhole network was exploited for 120k wETH. ETH will be added over the next hours to ensure wETH is backed 1:1. More details to come shortly.We are working to get the network back up quickly. Thanks for your patience.— Wormhole (@wormholecrypto) February 2, 2022
Following the hack, Paradigm security researcher “samczsun” has stated that the Wormhole team has reached out to the exploiter’s address on the Ethereum network, offering a $10 million bounty for returning the funds.
Why You Should Care
The continuous exploits of DeFi protocols validate claims that the security of DeFi is yet to reach the level of accommodating the huge sums being stored within them.
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