Curve Finance DeFi Platform Faces Major Exploit, CRV Tanks 16%

Curve DAO (CRV), the native cryptocurrency of one of the top decentralized finance exchanges has undergone a price crash after a major exploit on the DeFi platform caused due to a vulnerability in the programming language.

Similar to other DeFi projects in the crypto space, Curve Finance depends on different decentralized software built atop the blockchain technology. In a tweet on Sunday, July 30, Curve tweeted that the exploit happened in a particular version of Curve’s programming language Vyper. It noted:

A number of stablepools (alETH/msETH/pETH) using Vyper 0.2.15 have been exploited as a result of a malfunctioning reentrancy lock. We are assessing the situation and will update the community as things develop. Other pools are safe.

PSA: Vyper versions 0.2.15, 0.2.16 and 0.3.0 are vulnerable to malfunctioning reentrancy locks. The investigation is ongoing but any project relying on these versions should immediately reach out to us.

— Vyper (@vyperlang) July 30, 2023

Curve Finance provided further clarification, emphasizing the critical factor that led to the issue – the combination of the affected Vyper version and the use of pure ETH. They also clarified that crvUSD contracts and related pools remain unaffected.

Curve Finance (CRV) Token Tanks 16%

Soon after the news of the exploit, the Curve DAO (CRV) price came under major selling pressure. As of press time, the CRV token is trading 16% down at a price of $0.6135 and a market cap of $545 million.

BlockSec, a company that checks the security of crypto software, believes the hack has resulted in over $40 million in losses. According to Tarun Chitra, the CEO of Gauntlet, a firm that assesses crypto risks, the attacker managed to take around $20 million worth of CRV (a type of crypto token) and a version of Ether (another cryptocurrency).

Curve Finance is the largest DeFi exchange after Uniswap. Decentralized lending service Aave uses CRV as collateral. Chitra from Gauntlet also stated that they have not observed any indications of “bad loans” on the Aave platform caused by the drop in CRV. CoinGecko figures show that Aave’s token has decreased by approximately 4% in the past 24 hours.

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Bhushan Akolkar

Bhushan is a seasoned crypto writer with over eight years of experience spanning more than 10,000 contributions across multiple platforms like CoinGape, CoinSpeaker, Bitcoinist, Crypto News Flash, and others. Being a Fintech enthusiast, he loves reporting across Crypto, Blockchain, DeFi, Global Macros with a keen understanding in financial markets.   He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills. Bhushan has a bachelors degree in electronics engineering, however, his interest in finance and economics drives him to crypto and blockchain.

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