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DeFi sees its biggest hack in 2023 as Euler loses $197M: Finance Redefined

Welcome to Finance Redefined, your weekly dose of Decentralized Finance (DeFi) essentials – a newsletter designed to spotlight significant developments over the past week.

The DeFi ecosystem was once more a haven for exploiters last week because the Euler Finance lending protocol fell victim to an quick loan attack that resulted in a net lack of over $196 million – the largest hack of 2023 thus far.

Aside from the Euler Finance saga, USD Coin (USDC) depegging was the highlight that dominated the headlines last week. With the collapse of Silicon Valley Bank, investors have loaded their bags of USDC, with an exodus of funds from centralized exchanges (CEX) and decentralized exchanges (DEX).

MakerDAO has launched an emergency proposal to extend its holdings in US Treasuries by 150%, with the aim of diversifying the collateral exposure of its stable Dai (DAI) coins.

MetaMask has introduced latest features with improved controls to avoid privacy concerns. New features allow users to administer which servers can receive their IP addresses.

The DeFi market had one other bullish week because of rising positive sentiment within the broader crypto market amid a panic on major US banks. Most of the highest 100 DeFi tokens posted double-digit gains last week, with many tokens reaching latest multi-month highs.

Euler Finance hacked over $195 million in a flash-loan attack

The Ethereum-based Euler Finance non-trust lending protocol faced an quick loan attack on March 13. The attacker stole tens of millions in DAI, USDC, bet on Ether (StETH) and mined Bitcoin (WBTC).

According to on-chain data, in response to a recent update, the exploiter carried out multiple transactions, stealing nearly $197 million. The attack correlated with the deflationary attack from a month ago. The attacker used a multi-chain bridge to transfer funds from the BNB smart chain to Ethereum.

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Cryptocurrency users have turned to DEXs loaded onto USDC after the Silicon Valley Bank crash

Chain evaluation data shows hourly outflows from CEX to DEX rose to greater than $300 million on March 11, shortly after the California regulator shut down SVB.

An identical phenomenon occurred in the course of the collapse of cryptocurrency exchange FTX last yr amid fears that the contagion could spread to other crypto firms. However, data from blockchain analytics platform Token Terminal suggests that the rise in each day trade volumes for giant DEXs was short-lived in each cases.

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MakerDAO accepts proposal to extend US Treasury investments by USD 750 million

The credit protocol and stablecoin issuer MakerDAO accepted on March 16 a proposal to extend the portfolio of US treasury bonds by 150%, from USD 500 million to USD 1.25 billion.

The proposal goals to extend the protocol’s exposure to real assets and “high-quality bonds” after its stablecoin DAI lost its $1 rate during market volatility on March 11. The $750 million debt ceiling increase was approved by 77% of Maker delegates.

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MetaMask solves privacy concerns with latest features to extend your control

The Web3 MetaMask wallet app has introduced several latest features to boost privacy and provides users more control, in response to a March 14 developer blog post. The latest features come after MetaMask was previously criticized for allegedly violating user privacy.

Previously, MetaMask used its Infura RPC node to robotically hook up with Ethereum each time a user arrange a wallet for the primary time. While the user could change the settings later, it still meant the user’s public address was sent to Infury before they might change their node, in response to a report by Ethereum node operator Chase Wright.

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DeFi market overview

Analytical data shows that the overall market value of DeFi rose to $48 billion last week. Data from Cointelegraph Markets Pro and TradingView shows that the highest 100 DeFi tokens by market capitalization had a bullish week, with most tokens trading green apart from a number of.

Thanks for reading our roundup of this week’s most influential DeFi changes. Join us next Friday for more stories, insights and education on this booming space.

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