Solana Based Algo-Stable Protocol Nirvana Exploited For $3.5M

Over the week, Solana-based DeFi protocol Nirvana Finance suffered a flash loan attack, causing the stablecoin to depeg from $1.

https://twitter.com/AndyBTC\_/status/1552546781929639937

The hacker borrowed $10 million USDC from Solend's flash loan to exploit $3.49 million USDT from the Nirvana Finance Treasury.

Both $NIRV (stablecoin) and $ANA (Nirvana Finance's native token) dropped by 85% following the attack.

Image Credit: CoinGecko

The people at SolanaFM gave a good breakdown of how the exploit happened:

1. Hacker borrowed US$10 million USDC from Solend's flash loan
2. They use the borrowed fund to mint US$10 million worth of $ANA
3. Hacker swapped the newly minted $ANA for $USDT and received US$3.5 million USDT from Nirvana Treasury
4. They then return the $10 million USDC to Solend and transfer the full $3.5 million USDT into an ETH account.

https://twitter.com/0xFA2/status/1552576598506762240

The Nirvana team is now offering the hacker US$300,000 or 8.5% of the hacked amount as a whitehat bounty for the return of the treasury.

For the return of the treasury, the team would also stop all ongoing investigations in good faith.

https://twitter.com/nirvana\_fi/status/1552761630127177730

Also Read: Are All Stablecoins Doomed To Crash? Stablecoin Fundamentals You Have To Know

[Editor’s Note: This article does not represent financial advice. Please do your own research before investing.]

Featured Image Credit: CoinCu News