- Decentralized governance hedge fund platform Convergence exploited.
- 58M CVG tokens minted and swapped.
- CVG token worth plunged 99% from $0.12 to $0.0004 following the hack.
On Thursday, the decentralized finance (DeFi) protocol Convergence skilled a extreme breach, leading to a dramatic collapse of its CVG token.
The exploit concerned the creation of 58 million CVG tokens, which have been then exchanged for about $200,000 value of wrapped Ether (wETH) and crvFRAX stablecoin.
Hacker exploited a vulnerability in Convergence’s codebase
This malicious exercise was carried out utilizing a vulnerability throughout the protocol’s codebase, in keeping with web3 safety agency QuillAudits.
The attacker leveraged this flaw to mint an enormous quantity of CVG tokens, subsequently swapping them for wETH and crvFRAX via Curve’s liquidity swimming pools. Following the token change, the attacker transformed the funds into Ether (ETH) and transferred them to Twister Money, a privateness device designed to obscure transaction trails.
This breach led to an estimated $210,000 in monetary losses, whereas CVG token holders confronted a catastrophic decline within the token’s worth.
Earlier than the assault, CVG had a completely diluted valuation of $17 million. Nonetheless, the token’s value plummeted by 99% within the Curve liquidity swimming pools, dropping from $0.12 to a fraction of a cent, buying and selling at $0.0004.
Frens, @Convergence_fi was simply hit by an exploit leading to a lack of round $210,000. 🚨
The attacker minted 58 million $CVG tokens & swapped them for 60 WETH & 15.9k crvFRAX.
The value of $CVG on the time of exploit was $0.1155. It dumped 99% and is at the moment at $0.000413… pic.twitter.com/43MJGjQg2i
— QuillAudits ➡️ Web3 Safety 🥷🛡️ (@quillaudits_ai) August 1, 2024
Convergence asks customers to pause actions on the platform
In response to the incident, Convergence has suggested customers to chorus from interacting with the protocol to keep away from additional threat.
🚨 URGENT COMMUNICATION 🚨
Convergence has been hacked. Please do not work together with the protocol.
— Convergence (@Convergence_fi) August 1, 2024
The protocol’s workforce and safety specialists are at the moment investigating the breach to forestall future vulnerabilities and mitigate the harm brought on by the exploit.
This incident underscores the continued dangers related to DeFi protocols and the significance of strong safety measures in safeguarding digital belongings.
