Another big hack at Cream Finance, $130 million disappeared

Another big hack at Cream Finance, $130 million disappeared

The decentralized finance space has recently become an experimental area for hackers. Particularly popular here is the Cream Finance protocol, which has been breached as many as three times in 2021 alone. This time, more than $130 million flowed out of it.

DeFi’s image strained

Cream Finance is a lending protocol based on the Ethereum ecosystem. It has already been breached a couple of times during the current bull market. The incident in February, when hackers made a break-in resulting in an outflow of funds worth $37.5 million, became famous. The price of the CREAM token fell by nearly 30% in just one hour. A similar event, but with much more serious consequences, took place in August. Then the attacker managed to deprive the protocol of as much as $ 418 million in AMP, taking over about 1300 Ether at the same time.

Despite the aforementioned situations and the very negative experiences of developers as well as investors, Cream Finance is still not secured well enough. PeckShield Inc. has identified another successful attack that took $130 million in CREAM as its prey. The attack was in the nature of an instant loan. It resulted in the price of the CREAM token losing 28% of its value in just one hour. 

Such problems are a kind of water for the mill for regulators who, especially in the United States, notice the need to regulate the DeFi space, believing that the funds of its participants are not sufficiently protected. Could they be right?

Cream Finance isn’t the only one in trouble

It is worth noting that Cream Finance is not the only one facing network security problems. A high-profile case is that of Poly Network, from which a hacker managed to extract more than $600 million in August this year. It was the highest attack to date in the history of DeFi. We wrote more about this topic in the article titled “DeFi Poly Network platform hacked for over 600 million dollars”.

The market is flooded with new protocols that are often not secure enough. Their creators are also chasing the opportunity to get rich quickly, taking advantage of the current boom. Such actions are not conducive to security and, consequently, user welfare.

While we don’t claim that this is the case with Cream Finance, we do recommend learning from others’ mistakes. An in-depth study of the ecosystem we plan to invest in is essential to increase the security of our funds. We believe that the problems faced by selected DeFi protocols will become a valuable lesson not only for their creators, but also for all of us.

Disclaimer: Blockbulletin does not take accountability of investments based on the information of the website. We highly advice readers to make extensive research prior to any invest

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