Onyx Protocol Loses $2 Million In Flash Loan Exploitation

Onyx Protocol Loses $2 Million In Flash Loan Exploitation

In the latest security breach event, the decentralized finance (DeFi) project Onyx Protocol became a victim of flash loan exploitation and lost approximately $2.1 million worth of Ethereum (ETH) coins.

As per reports, the wallet address of the Onyx protocol exploiter has a balance of 1,164 ETH, worth around $2.1 million, which was exploited by scammers.

Onyx Protocol Suffers Security Breach

To commit the theft, the attacker initiated their scheme by making a seemingly innocuous donation of a small sum to the oPEPE market. 

With this initiative, they were eligible to borrow a substantial amount of funds from other markets that possessed ample liquidity. Further, the donated funds were utilized as collateral for the borrowing process. After that, the attackers then redeemed the borrowed funds and exploited the rounding issue to make a profit. 

The theft was easy as the oPEPE market was set up 5 days ago and didn’t have any funds, which turned out to be an advantage for the attackers. 

In detail, the attacker created a flash loan of 4,000 ETH from Aave, an open-source liquidity protocol, and swapped it to the meme coin, PEPE, before the exploitation of the oPEPE smart contract on Onyx.

This is the latest in a series of crypto exploits, which led the Decentralized Finance to lose $2.1 million worth of ETH tokens.

Read Also: Bitcoin Price Prediction As Traders Eye Fresh Entries Post FOMC Meeting, How Far Can Dips Go?

Alyx Onex, Onyx Protocol’s Community Leader Statement

The Onyx Protocol Community leader Alex confirmed the theft and said the team has now closed the vulnerability and is working to proceed further. Taking to the X platform, formerly known as Twitter, Alex said they are aware of the problem and working to proceed further.

Meanwhile, recently such exploit attacks and crypto scams targeting DeFi are on the rise, with an alarming concern to the crypto community.

Recently, Hundred Finance also reported a similar instance of exploit, in which it experienced a significant security breach on the Ethereum layer-2 blockchain Optimism. The protocol tweeted that the losses are close to $7.4 million.

Moreover, the monthly report from CertiK Alert reveals that crypto enthusiasts lost a combined total of over $32 million due to exploits, hacks, and scams in October. 

 Read Also: Hong Kong’s Largest Virtual Bank Opens OKX Operating Account

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