Prisma Finance Faces Major Setback as $9M Lost Via Hack

Prisma Finance, a non-custodial and decentralized finance (DeFi) protocol, has fallen victim to a significant hacking incident. According to a report on X by the Web3 security platform Cyvers, the protocol has lost a staggering $9 million due to multiple suspicious transactions. 

Understanding the Exploit 

The attack on Prisma Finance is the latest in a series of high-profile hacks that have plagued the DeFi space in recent years. According to a confirmation report by blockchain security and analytics firm PeckShield, the attackers exploited a vulnerability in Prisma Finance’s smart contracts, allowing them to drain funds from the protocol. The funds stolen include Prisma mkUSD and wrapped stETH. 

The protocol has advised vault owners to disable delegate approval. This is to assist in further investigations and to prevent additional risks to current funds.

Prisma Finance Postmortem Report Upcoming

Although Prisma Finance has yet to release detailed information about the hack, the protocol has acknowledged the incident and is working to address it. However, the protocol plans to publish a postmortem report detailing what went wrong with the protocol once the glitch is resolved. In a statement released shortly after the attack, the team behind Prisma Finance assured users that they are investigating the matter and taking steps to mitigate the damage.

The action by the Prisma Finance team further underscores the claim that users’ funds are secured and remain uncompromised. Undoubtedly, the impact of such a breach extends beyond the financial losses incurred by the protocol and its users. Confidence in the broader cryptocurrency market may be temporarily shaken as the incident reminds one of the risks associated with digital assets.

It is crucial for platforms to prioritize security measures, conduct regular audits, and implement safeguards to prevent and mitigate potential breaches.

Crypto Market Records Lots of Hack and Scams in 2023

As reported by Web 3.0 security firm Beosin, the crypto industry suffered huge losses of around $656 million owing to hacks, scams, and rug pulls in the first half of 2023. The report highlighted 108 protocol attacks, resulting in a loss of $471.43 million. Additionally, phishing scams accounted for $108 million in losses, while 110 instances of rug pulls resulted in losses of $75.87 million.

Also, Jimbos protocol fell victim to a devastating attack resulting in a loss of 4090 Ether worth $7.5 million. As per the report, the attacker used a $5.9 million flash loan to carry out the hack.