Over $6m worth of DEI, a stablecoin of the DEUS decentralized finance (DeFi) protocol, DEI, was stolen in a hack, the latest details on May 6 show. The exploit led to a loss of more than $5m on Arbitrum, an Ethereum layer-2 solution, and $1.3m in BNB Smart Chain (BSC).
DEI losses over $6M in a hack
A report from PeckShield, a blockchain security company, shows that DEUS Finance lost over $6m in a hack targeting two networks, BNB Chain and Arbitrum.
While confirming the hack, DEUS said they had lost $5m from the Arbitrum network and $1.3m on the BSC.
PeckShield noted that the hack was front-run by a bot and compromised the ARB/ETH deployments too.
The white-hat hackers determined that a vulnerability in DEI’s smart contract allowed anyone to mint new DEI without any control. Hackers exploited this loophole and attempted to drain DEI from the affected networks.
The DEUS team appreciated the white hackers’ fast response and suspended affected contracts, mitigating losses. These contracts have since been destroyed.
Is DEUS losing user trust?
This hack is not the first time that freeloaders are hitting DEUS.
Previously, the protocol experienced two hacks that led to the loss of $13.4m and $3m, respectively.
The hackers used flash loans that tricked DEUS’ smart contracts data reading format on the platform’s liquidity pools. Attackers then inflated the value of some assets, got a loan, and made enormous profits after repaying the loan.
The attackers borrowed $143m as a flash loan and made a profit of $13.4m, with the protocol suspected to have incurred more significant losses.
The DEI stablecoin has also experienced notable setbacks. The stablecoin has de-pegged, falling to as low as $0.28 after a 71% fall following the hack. Previously, the coin had dropped to $0.59 due to the direct effects of the LUNA-UST collapse last year.
The recent occurrences have compromised the security of DEUS, raising questions about its ability to protect users’ assets.