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DeFi Protocol Pickle Finance Token Loses Almost Half Its Value After $19.7M Hack
Popular decentralized finance protocol Pickle Finance was hacked on Saturday, draining $19.7 million in DAI.
Popular decentralized finance (DeFi) protocol Pickle Finance was hacked on Saturday, draining $19.7 million in DAI, a decentralized stablecoin pegged to the U.S. dollar, from a Pickle wallet.
STORY CONTINUES BELOW
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- “There are reports that our DAI PickleJar strategy has been exploited. We are actively looking into this matter and will provide further updates,” the Pickle Finance team announced on their official Twitter account.
- The price of Pickle's native token (PICKLE) fell 50.12% to $10.17 on the news, according to Messari data. It has since rebounded to around $12.60.
Pickle came on the scene Sept. 11 as one of many food-themed DeFi projects. The fully automated system rewards users with interest payments and token disbursements in PICKLE, ether and stablecoin pairings for providing liquidity to several stablecoin pools.
- The project attempted to bring price stability to the four top stablecoins, DAI, USDC, USDT and sUSD, which are frequently knocked off their dollar peg.
- Pickle’s pJars, similar to yearn.finance’s vaults, found and executed arbitrage opportunities between stablecoin deposits on several protocols, nominally to push these stablecoins towards their peg, but also to reward Pickle users.
On Friday, the team introduced the cDAI jar, a “new strategy” aimed at maximizing returns from DAI deposited on the decentralized lending protocol Compound. The Pickle team, and a group of "white hat hackers" have traced the 19,759,355 DAI weekend exploit to this smart contract, according to a blog post.
- "This was a very complicated attack and involved many components of the Pickle protocol. As of right now, it does not seem that any other funds are at risk," they said. "While we work on the fix to remove the attack vector, the white hat group has decided that we should not publish any details of the actual attack yet."
- A fix was estimated by Sunday at 15:00 UTC.
“We’re encouraging all LPs to withdraw their funds from the Jars until the issues have been resolved,” the Pickle team tweeted.
Daniel Kuhn
Daniel Kuhn was a deputy managing editor for Consensus Magazine, where he helped produce monthly editorial packages and the opinion section. He also wrote a daily news rundown and a twice-weekly column for The Node newsletter. He first appeared in print in Financial Planning, a trade publication magazine. Before journalism, he studied philosophy as an undergrad, English literature in graduate school and business and economic reporting at an NYU professional program. You can connect with him on Twitter and Telegram @danielgkuhn or find him on Urbit as ~dorrys-lonreb.
Kevin Reynolds
Kevin Reynolds is editor-in-chief at CoinDesk. Prior to joining the company in mid-2020, Reynolds spent 23 years at Bloomberg, where he won two CEO awards for moving the needle for the entire company and established himself as one of the world's leading experts in real-time financial news. In addition to having done almost every job in the newsroom, Reynolds built, scaled and ran products for every asset class, including First Word, a 250-person global news/analysis service for professional clients, as well as Bloomberg's Speed Desk and the training program that all Bloomberg News hires worldwide are required to take. He also turned around several other operations, including the company's flash headlines desk and was instrumental in the turnaround of Bloomberg's BGOV unit. He shares a patent for a content management system he helped design, is a Certified Scrum Master, and a veteran of the U.S. Marine Corps. He owns bitcoin, ether, polygon and solana.
