BNB

The Venus Protocol Exploit Saga: What Happened?

by BSC News

December 11, 2023

chain

Venus protocol temporarily paused certain markets for security upgrades and pledged liquidity injection, aiming to recover approximately $274K.

Venus Protocol, a lending platform on the BNB Chain, recently faced a storm of speculation surrounding a potential exploit. Blockchain security firm SlowMist's findings fueled the rumors, which caused ripples in the crypto community. 

Venus Protocol responded, alleviating concerns by asserting that the issue was not with the Venus Core Pool or its native token, XVS. The protocol attributed the problem to a short-term pricing discrepancy caused by the Binance Oracle, affecting a specific isolated pool.

Brad Harrison's Clarification 

Further, on December 10, 2023, Brad Harrison, Head of Venus Labs, stepped forward on X to dispel inaccuracies. He clarified that reports of an exploit were inaccurate, detailing that the Binance Oracle reported a wrong price, resulting in approximately $200,000 of borrows. 

Harrison emphasized that no other pools were affected and outlined plans to enhance security on isolated pools, particularly in terms of price resilience.

In response to the incident, Venus Protocol temporarily paused the snBNB market, along with two other isolated markets, agEUR and stkBNB, with similar Binance Oracle configurations. 

The protocol assured the community that the snBNB price feed returned to normalcy, emphasizing that the Core Pool and other markets remained unaffected. Venus Protocol pledged to inject liquidity from the treasury into the affected pool and initiated recovery efforts with partner support.

In the wake of the exploit speculations, Venus Protocol's native token, XVS, fell 12%, reaching $9.48, according to CoinMarketCap. However, the total value locked on the DeFi protocol remained mostly unaffected, standing at $716 million at the time of writing, as per DefiLlama.

Disclaimer

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