Feb 2021 - Yeld Finance "Lightning Loan" Attack - $160k (Global)
"Yeld Finance is a DeFi protocol pushing blockchain technology forward with innovative developments in the lending, staking and NFT spaces among others." "YELD is a deflationary decentralized finance (DeFi) protocol built on Ethereum. The YELD platform allows users to earn by staking their stablecoins in our smart contract vaults and earn YELD tokens in return." "Yeld finance in a few words is the next step in stablecoin yield farming for those that want high and consistent returns for the long term, to reward holders permanently."
"Our staking dApp uses a new Buy and Burn algorithm where we split the daily yield generated by users in half to automatically buy ETH and exchange it for YELD tokens on Uniswap. Those YELD tokens are burned to reduce the total supply resulting in an instant price increase. The total supply of YELD will continue to decrease until it reaches 10,000 YELD."
"On February 27, 2021, Beijing time, [Beosin-Blockchain Security Situational Awareness Platform (Beosin-OSINT)] Public opinion monitored that Yeld.finance, a well-known DeFi project, officially issued a notice stating that the project’s DAI pool suffered lightning Loan attack."
"The Beosin security team immediately intervened in response to the transaction mentioned in the original text
(0x57b378f8d20d3945ab40cd62aa24063f375bcfc5693c2e788dc193ffa1a5cc3a) for analysis. The analysis after the discovery, the transaction is Yeld.finance project’s own policy mechanism resulting from the transfer of funds, regardless of the credit lightning attack. The lightning loan attack means not to bear the pot."
"The DAI pool of Yeld.finance, the DeFi revenue aggregator, was attacked by a lightning loan, resulting in a loss of 160,000 DAI, involving more than 10 users. Tether, TrueUSD and USDC were not affected. According to reports, Yeld’s problem is consistent with the previous Yearn.Finance DAI pool vulnerability problem. The official also stated that the affected users will be repaid with tokens, which will be rewarded with income from the DAI pool to make up for some of their losses."
"Later, Yeld.finance officially stated that the 160,000 DAI caused by the lightning loan attack has been returned. This event is suspected to be the work of a white hat, and the official will further update the details."
On "April 19th, 2021", the project had an audit which reported that "No security issues from external attackers were identified." and to "Ensure trust in the project team as they have notable power in the ecosystem."
Further Analysis
According to the SlowMist story, there was a lightning attack here. The Blockcast.cc story raised doubts about the nature of the attack, and there was limited coverage by any other security experts.
The original post about the attack was deleted by the team. According to SlowMist, the funds were returned by the attacker. The Solidity Finance audit notes that the project team has notable power in the ecosystem.
How Could This Have Been Prevented?
More Cryptocurrency Exchange Hacks/Scams/Frauds
Daedalus Fake Cardano Wallet Application > > < < Ledger and TrustWallet Cryptocurrency Theft wuay
Sources/Further Reading
SlowMist Hacked - SlowMist Zone (May 18)
YELD Finance (Jul 17)
An Introduction To Yeld (Jul 17)
Yeld Finance - CypherHunter (Jul 17)
Yeld Rebrand Revised 2021 - YouTube (Jul 17)
The theft of 160,000 US dollars of assets was an oolong incident? A brief analysis of the Yeld.finance ``lightning loan attack'' event • Blockcast.cc- News on Blockchain, DLT, Cryptocurrency (Jul 17)
The Yeld Dai Earn Vault Has Been Hacked (Jul 17)
Yeld Finance Audit - Solidity Finance (Jul 17)
blocksec-incidents/2021.md at main · openblocksec/blocksec-incidents · GitHub (Aug 11)
@YeldF Twitter (Aug 11)
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