The value of the FARM token of the decentralized finance (DeFi) protocol Harvest Finance plummets after it was the victim of a hack in which it lost at least $24 million of its liquidity funds.
As reported by the DeFi protocol in a recent tweet, Harvest Finance was the victim of an attack in which hackers managed to obtain at least $24 million, exchanging most of these funds for tokens. renBTC (rBTC), and the same mixing it in the obfuscation service of Ethereum, known as Tornado Cash.
Harvest Finance reports that it was the victim of an attack that was executed through an exploit within its liquidity pools, which allowed the creation of flash loans in which a disproportionately large amount of protocol assets were deposited and withdrawn. Although this is the version of events claimed by experienced DeFi analyst Harvest Finance, Chris Bleck, noted, just one day before the attack, that this DeFi protocol had a critical vulnerability, which involves the administrator key handled by the Harvest Finance developers, and which can be used to drain all funds deposited in the smart contracts (smart contracts) of the platform.
Since this news was released and at the time of going to press, the value of the FARM token has lost more than 65% of its value in the markets, going from a value of $237,6 USD to just $126,7 USD, as sample CoinGecko on your platform. This drop is the result of the massive withdrawal of funds by users, who to date are estimated to have withdrawn more than $580 million from Harvest Finance.
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Mitigating the attack
In the Harvest Finance post, the developer team also claims to be carrying out all necessary procedures and work to mitigate the consequences of the attack. The funds deposited in the protocol were withdrawn to the vault and are being blocked to guarantee security to its users.
“To protect users, 100% of the platform funds in the stablecoin and BTC have been withdrawn from the platform to the vault… We are moving to block deposits to the vault… Existing deposits will continue to earn FARM” .
An unexpected turn
After the attack, around 2,5 million of dollars were returned to the protocol in the form of Tether (USDT), a stablecoin pegged to the dollar, and USD Coin (USDC). Given the return, the developers of Harvest Finance stated that these funds will be distributed among the users affected by the attack.
Furthermore, the developers stated that they are making a concerted effort to identify all the Bitcoin addresses to which the stolen funds were transferred, revealing that they have made significant progress in this matter. Ren Protocol has helped the protocol to identify several of the addresses to which the funds were transferred. Harvest Finance has reached out to major exchanges and cryptocurrency exchanges, such as Binance and Coinbase, to request the blocking of funds attempting to be exchanged within their platforms.
Likewise, in order to discover the person responsible for this attack, Harvest Finance is offering a reward of $100.000 to anyone who can identify the attacker or the whereabouts of the funds. However, a tweet posted by Harvest Finance, claiming to have enough data to identify the attacker, “who is well known in the crypto community,” is also creating a stir in the crypto community. Many DeFi users dare to afirmar It may be one of the developers of the protocol, who anonymously acts as a computer attacker.
Harvest Finance assured that it has no interest in taking legal or punitive measures against the attacker when it discovers his identity, as it respects his skill and ingenuity in having stolen the protocol's funds.
“We are not interested in do doxing the attacker, his skill and ingenuity is respected, simply by returning the funds to the users.”
According to the protocol's statements, Harvest Finance's interest is to recover all of the funds and return them to its clients and users affected by the hack.
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