Abracadabra Money recently faced a security incident involving its gmCauldrons, resulting in a loss of about 13 million MIM.
The gmCauldrons, which allow users to leverage gmTokens for borrowing MIM or using yield-bearing LP tokens, are essential to the Abracadabra ecosystem. Despite several audits and ongoing monitoring, the exploit still occurred. Fortunately, no user funds were lost, and other Abracadabra products remain secure.
With approximately $19 million in assets, the Abracadabra DAO treasury responded to the hack by acquiring 6.5 million MIM and repaying 50% of the total loss, with the remainder to be covered over the next few months. Additionally, $4 million is in the Depeg Contingency Fund for future use. Part of the treasury is set aside to buy back the exploited MIM to stabilize supply and maintain its peg, which showed only a slight deviation from $1 during the crisis.
The DAO expects to resolve the incident by mid-2025. The first burn transaction of repurchased MIM is public. Their guiding principles include protecting LPers, preserving protocol integrity, and rebuilding trust through action and transparency.
The Crypto lending platform is collaborating with Chainalysis to track stolen funds at several addresses. They’ve informed centralized exchanges and are open to negotiating with the hacker for a bug bounty in exchange for the return of the funds. They encourage anyone with relevant information to come forward. Despite this setback, they highlight their history of overcoming challenges and are committed to rebuilding. A technical post-mortem of the exploit is being finalized.
Similarly, zkLend, a Layer 2 money-market protocol on Starknet, suffered a security breach resulting in the theft of over $9 million in Ether. In response, the platform suspended withdrawals and launched an internal investigation. The developers publicly acknowledged the breach and offered the hacker a deal: return 90% of the stolen assets (about 3,300 ETH) and keep 10% as a “whitehat bounty.”
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