The Euler Finance exploit has been making headlines for the past few weeks, with each passing day bringing more drama to the biggest decentralized finance hack of 2023.
However, there is some good news as more than 50% of the stolen funds have been returned as per the latest update.
On 25 March, around 51,000 Ether worth over $89 million was sent from the Euler Finance hacker’s address back to the deployer address, and a second transfer of 7737 ETH, equating to about $13 million, was carried out by the exploiter hours later.
This news is a significant relief to the DeFi industry, which has witnessed remarkable growth since 2021. With funds deposited on their smart contracts increasing by leaps and bounds, DeFi protocols have also managed to grab the attention of unscrupulous players.
According to DeFiLlama, the total value hacked at the time of writing was $6.45 billion. DeFi protocols lost more than $3 billion in 2022, which was the worst year on record.
While there was a considerable lull during the months of December and January, hackers returned to deal a severe blow to the DeFi industry. In February, seven protocols were attacked, which led to $21 million of funds being stolen. One of the biggest was the flash loan reentrancy attack on Platypus Finance, where hackers managed to siphon off $8.5 million.
The Ethereum-based DeFi protocol was targeted by a flash loan attack on 13 March when the hacker managed to drain out assets worth $197 million in Dai, USD CoiN [USDC], staked Ether [StETH], and wrapped Bitcoin [WBTC].
Euler Finance announced a $1 million bounty for any information about the hacker after attempts at finding a middle ground failed. However, in an on-chain message to Euler on 20 March, the hacker said they now want to “come to an agreement” with the lending protocol.
Notably, 16% of the hacks were attributed to the compromise of private keys. And nearly 8% of the funds were hacked when the protocols fell victim to access control exploits. DeFi protocols need to strengthen their security measures to ensure that such hacks do not occur in the future.
