The recent exploit of UwU Lend on Monday had a significant impact on the DeFi lending platform Curve, resulting in the automatic liquidation of $100 million in loans taken by founder Michael Egorov from various protocols. This led to a 30% drop in the CRV token value before a brief recovery.
Despite the challenges faced by the platform, Egorov remains committed to ensuring that all users can withdraw their deposits and is determined to make Curve Finance’s lending and borrowing products the safest in the industry. The exploit was linked back to UwU Lend, a protocol that allows users to borrow, lend, and stake tokens. The vulnerable code deployed by UwU Lend for new markets put the entire platform at risk, leading to the hacking incident.
UwU Lend suffered a $20 million loss from a flash loan attack on Monday and an additional $3.7 million loss in a separate attack on Thursday. The platform is now offering a $5 million bounty reward to catch the attackers. Egorov estimated a bad debt of $10 million in a specific CRV lending pool, preventing depositors from withdrawing their funds until the issue is resolved.
Despite the challenges faced by Curve, Egorov sees an opportunity to strengthen the platform’s security measures and loan mechanisms. He believes that the recent events will ultimately lead to the development of a safer and more resilient lending and borrowing service for users in the future. Egorov emphasized that the safety and well-being of Curve Finance’s community are his top priorities.
Curve remains one of the largest crypto protocols, with over $2 billion in locked assets as of Friday, according to DefiLlama data. The recent incidents have highlighted the importance of robust security measures in the DeFi space and the need for continuous improvement to protect users’ funds and assets. Egorov’s dedication to enhancing Curve’s safety and resilience bodes well for the platform’s future development and growth in the industry.