As cryptocurrencies have experienced a meteoric rise in adoption over the past few years, so has the number of scams increased alongside. The decentralized Finance (DeFi) sector has been one of the most exploited in 2021.
Grim Finance, a protocol on the Fantom blockchain that allows users to stake their liquidity pool tokens (in Grim Vaults) and automatically harvest yields and re-staking rewards, is the latest DeFi protocol on a long list to be exploited.
Grim Finance Suffers $30 Million Hack
On December 18, Grim Finance announced that it had suffered an advanced hack, and “over $30 million” worth of cryptocurrencies” was stolen from its Grim Vaults.
According to Grim Finance, the hacker exploited the protocol’s vault contract through five reentrancy loops. Using five loops allowed the hacker to fake five additional deposits into a vault while the platform was processing the first deposit.
Grim Finance has all of the vaults and deposited funds, as the entire network was considered to be at risk.
The hacker(s) continued transacting on the network until December 19, moving as much as 1,000,000 FTM on several occasions.
The lack of a re-entrancy guard on the network led to $30 million being siphoned from Grim Finance. The latest Hack now means hackers have stolen $600 million from DeFi protocols in December 2021 alone.
On The Flipside
Despite continuous exploits, DeFi adoption is at an all-time high, with more than $250 billion locked in several DeFi protocolsWhy You Should Care?
Before mainstream adoption, DeFi protocols need to solve their security problems. DeFi hacks now account for almost 80% of all major hack volume in the crypto industry.
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