Outdated Yearn Finance Contract Hacked, $11.6 Million Stolen in Stablecoins

On Thursday, a hacker exploited an outdated contract from Yearn Finance, a decentralized finance (DeFi) platform, and stole $11.6 million worth of stablecoins. The attacker managed to create a quadrillion yUSDT stablecoins by exploiting a vulnerability in the code of an old Yearn Finance contract. The tokens were then swapped for various other stablecoins, including USDP, TUSD, BUSD, USDT, USDC, and DAI.

DeFi platforms have been particularly vulnerable to hacking attacks, and Yearn Finance is just one of the many platforms that have suffered such attacks. The hacker in this case managed to take advantage of an outdated contract, highlighting the importance of regularly updating and auditing smart contracts to prevent such incidents.

As reported by PeckShield , after the successful theft, the hacker transferred the funds to other DeFi platforms, such as Aave, where they locked 1.5 million TUSD as collateral to borrow 634 Ether worth $1.26 million. The hacker also sent at least 1,000 Ether to Tornado Cash, a mixing service that is sanctioned by the U.S. Treasury. Tornado Cash is a tool that allows users to anonymize their Ethereum transactions, making it difficult for authorities to track the flow of funds.

The theft is just one of the many incidents of crypto theft that occurred in 2022, with blockchain forensics firm Chainalysis reporting that hackers stole at least $3.8 billion in cryptocurrencies throughout the year, the highest recorded total. DeFi platforms suffered more than 82% of the losses, highlighting the need for improved security measures in the DeFi space.

This incident is a stark reminder that the DeFi space is not immune to cyberattacks and that there is a need for continued innovation in security measures to safeguard users’ funds. The rise of DeFi has brought about exciting new opportunities in finance, but it has also created new risks that need to be addressed. Regular security audits, code reviews, and bug bounties are just some of the measures that DeFi platforms can implement to improve their security posture.