Platypus DeFi loses $2.2M in another flash loan exploit

Platypus, a decentralized finance (DeFi) protocol, has suffered a major blow as it lost over $2 million in assets due to a flash loan exploit. The attack prompted the platform to temporarily suspend all of its pools.

Multiple attacks

The blockchain security platform CertiK revealed that Platypus experienced a total of three attacks, resulting in a loss of $2.23 million. The first attack occurred on Oct. 12 and took away $1.2 million. Shortly after, a second attack stole $575,000 worth of assets. Within minutes, a third attack followed, resulting in a loss of $450,000.

Platypus: An automated market maker protocol

Platypus is an automated market maker protocol that enables the automatic trading of digital assets through liquidity pools, rather than traditional buyer-seller markets. The platform raised $3.3 million in a funding round led by Three Arrows Capital, which has since gone bankrupt.

Flash loan exploit

The losses incurred by Platypus were a result of a flash loan exploit. This type of attack allows traders to borrow cryptocurrency instantly without providing the required collateral for the transaction.

Repeat attacks

This recent flash loan attack marks the third time Platypus has been targeted. In a similar exploit on Feb. 16, the protocol lost $8.5 million, leading to the de-pegging of the Platypus USD stablecoin, causing its price to drop from $1 to $0.48. In July, the platform also suffered a flash loan exploit, resulting in a loss of approximately $157,000.

Compensation portal for victims

In response to the February attack, Platypus established a compensation portal in March. This allowed victims to verify the amount of compensation they were eligible to receive and voice their concerns before the funds were distributed.