Origin Protocol Loses $3.25M in Latest Flash Loan Attack: Reports
Origin Protocol Loses $7M in Latest Flash Loan Attack
Blockchain project Origin Dollar (OUSD) said it sustained an attack that caused a loss of funds worth $7 million, including over $1 million deposited by Origin and its founders and employees. and has disabilized deposits as a result. The project’s native token is down 36% on the day, according to CoinGecko.
- Origin urged people not to buy OUSD on Uniswap or Sushiswap as those prices don’t reflect OUSD’s underlying assets.
- Earlier reports said the stolen funds included $2.25 million in dai (DAI) and $1 million in ether (ETH).
- The attacker utilized a flash loan to manipulate asset prices including OUSD, according to Etherscan. Origin pointed to this transaction as the likely root of the attack.
- Flash loans enable investors to take out large sums of funds to use as leverage in DeFi trading. Due to the atomic nature of Ethereum transactions, the loan can be taken out and returned in the same transaction, meaning collateral is not needed.
- Although catchy, flash loans are not the underlying issue in these recent exploits, Aave founder Stani Kulechov told CoinDesk in a message. Rather, the fault lies with poorly structured pricing oracles, he said.
- “If you are a protocol developer, start reviewing your code NOW to avoid similar flash loans vulnerabilities,” Kulechov said.
- Origin Dollar has not returned questions for comment by press time.
UPDATED at 02:38 UTC on 11/17/2020 with confirmation of the attack and increase in the amount of funds lost to $7 million.
