A leading DeFi protocol Abracadabra Finance has reportedly fallen victim to a serious security attack, dealing a significant blow to the decentralized finance (DeFi) sector.
Abracadabra Finance Became the Victim of a $6.4 Million Cyber Attack
Initial estimates from security analysts indicate that the protocol suffered losses in excess of $6.4 million in the attack.
Security firms PeckShield and Blocksec described the incident as a malicious attack and emphasized the urgency of addressing the situation.
According to Blocksec, a preliminary investigation points to an attack on the project's smart contract, but a more in-depth investigation is required.
As of last assessment, Blocksec estimates that approximately $29 million in assets are still in the affected contract, posing ongoing risks. The company called on the project and users to take immediate action to reduce possible losses.
Known for its DeFi lending and borrowing tools, Abracadabra Finance allows users to use various cryptocurrencies as collateral to borrow a stablecoin called Magic Internet Money (MIM).
The Abracadabra Finance team has released an official statement acknowledging the vulnerability. “We are aware of a vulnerability involving certain boilers in Ethereum.
“Our engineering team is reviewing and investigating the situation.” The project also announced that the DAO treasury will initiate MIM buyback from the market and then burn the tokens as part of the recovery process.
*This is not investment advice.