DeFi lending platform Sentiment has suffered a major security breach, losing almost $1 million in a reentrancy attack. The team has confirmed that the attack took place, and the situation is being handled by the team along with third-party security auditors. The team has implemented a fix for the problem, allowing users to repay debts and unwind their positions, while also working with law enforcement to recover the funds and identify the hacker.
Sentiment was exploited for the funds on Arbitrum, with the hacker using a view re-entrance Balancer bug to execute malicious code before pool balances were updated and steal money using overpriced collateral. The exact figure of the theft remains unclear, but it is believed to be close to $1 million.
This is just the latest in a string of DeFi attacks in the past few months. The industry has had a tough start to 2023, with Euler Finance losing approximately $200 million, and Allbridge losing about $570,000 due to a possible manipulation of a swap-related formula.
As the DeFi market continues to be a major target for hackers, Allbridge, a cross-chain bridging solution provider, is promising leniency to the hacker who exploited its multichain tool if the stolen funds are returned. Offering a “white hat bounty” to the hacker, Allbridge says that it won’t take legal action against the attacker if the funds are sent back. The attack targeted the Binance USD (BUSD) and Tether (USDT) pairs, leading to the temporary suspension of the bridge.
Attacks like these are a reminder of the risks involved in investing in the industry. While it is crucial for DeFi protocols to have proper security measures in place, users also need to exercise caution and conduct their own due diligence when investing in the space.
