In the latest news development, DeFi Protocol Arcadia Finance has suffered an attack leading to the loss of hundreds of thousands of dollars.
Arcadia Finance is a non-custodial leveraged farming protocol designed to enable composable cross-margin accounts on-chain. With Arcadia, users can leverage up to 10x their initial collateral value and transact with other protocols using a single cross-margin account.
Arcadia Suffers From Code Vulnerabilities
Earlier today, July 10, blockchain intelligence firm PeckShield posted a security alert stating a hacker exploited Arcadia Finance on Ethereum and Optimism draining approximately $455,000 from the protocol.
PeckShield reported that the heist occurred due to the absence of “untrusted input validation” in the program code of Arcadia Finance, allowing the hacker to gain access to the DeFi protocol’s darcWETH and darUSDC wallets.
In addition, the security company also pointed out that Arcadia Finance suffered from a “lack of reentrancy protection,” which enabled the hacker to execute an instant liquidation regardless of the internal vault health status.
So far, PeckShield reports that the funds stolen off the Optimism chain – 179.03 ETH – have been washed via Tornado cash protocol while that from the Ethereum chain remains in the hacker’s wallet.
Two hours following PeckShield’s alert, Arcadia Finance posted a tweet acknowledging the hack. The DeFi project’s management said it had halted all ongoing contracts and has commenced an investigation with the help of security experts.
According to data from DeFiLlama, Arcadia’s recent exploit has caused the protocol’s TVL to plummet by 76%, falling from $604,440 to its current value of $142,824.
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Crypto Heists Remain Rampant In 2023
Interestingly, the DeFi attack on Arcadia Finance occurred barely days after the Multichain protocol suffered a hack that led to the theft of $126 million. According to a report from Certik Security, over $313 million was lost to crypto scams and hacks in the second quarter of 2023.
While this figure represents a 58% decline from 2022 Q2, it is quite similar to the figure recorded in the first quarter of 2023, which was $320 million. Certik reports that the month of June recorded the highest amount of losses at $135.2 million in 2023 Q2, followed by April with $103 million.
Of the numerous hacks which occurred in this last quarter, the largest incident was that in which over 5,000 Atomic wallets suffered a combined loss of over $100 million in early June.
Related Reading: Voyager Platform Sees Over $250M In Withdrawals As Creditors Swiftly Pull Out Funds
Other notable hacks included a $25 million loss due to a sandwich attack on several Ethereum MEV bots, the $23 million hot wallet heist on the Bittrue exchange, etc.
In other news, the general crypto market is experiencing a slight dip, declining by 0.63% in the last 24 hours, according to data by CoinMarketCap. Bitcoin, the market leader, is currently trading at $30,211.75, representing a 0.35% drop in the last day.
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