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Beanstalk Farms loses $180 million in exploit



 Again, it's a flash loan that was used for an exploit that caused millions of dollars in damage. Beanstalk is a stablecoin protocol that hedges the equivalent of the stablecoin BEAN through a decentralized credit system rather than on- or off-chain assets.


Apparently, a proposal for improving the protocol was submitted, which contained a vulnerability that the attacker promptly exploited. Through a $1 billion flash loan, he quickly gained control of the protocol, thereby undermining governance.


He effectively managed to vote for his own proposal and in this way to withdraw various crypto assets worth around 180 million US dollars from the minutes.


In other cases, there were errors in a smart contract or at least an incorrect interaction of different protocols. In this case, the system was working properly but was being misused. In fact, on-chain governance by all parties involved should actually be a strength of Beanstalk.


With a so-called flash loan, the borrowed amount has to be repaid in the same transaction. Therefore, the attacker was able to borrow an extremely large sum, which, however, never actually came into his possession. Apparently no one thought that this mechanism could be misused to force a voting result at short notice.



In principle, the attacker granted himself permission to deduct the funds from the protocol. Additionally, the hacker donated $250,000 to Ukraine, which is partially funding its war with cryptocurrency donations. The hacker pocketed around $80 million himself and paid around $100 million to various protocols as a fee for his devious operation. After the Ronin Network was recently the target of an attack and lost a record $600 million, investors in Beanstalk have been left behind. It is currently still unclear how the company behind Beanstalk intends to deal with the situation. Twitter was open to contacting the hacker, but compensation has not yet been publicly discussed.  

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