Moonwell Loses 8.7 Million Due to Price Manipulation

Lending protocol Moonwell lost an estimated 8.7 million dollars to an exploit on Thursday, with no smart contract being hacked. An attacker inflated the price of MAMO, a small Base token, allowing them to borrow real assets like Coinbase Wrapped Bitcoin (cbBTC) and USD Coin (USDC). Security firm Blockaid detected the activity, prompting Moonwell to freeze new borrowing within hours. The attacker manipulated MAMO collateral pricing to drain cbBTC from Moonwell's mCBTC market, with initial estimates showing 50.6 cbBTC lost, valued at over 4 million dollars. MAMO's total market value is about 7.6 million dollars, while the token trades near 0.011366 dollars, making it easy to manipulate. The exploit involved pumping MAMO's price on thin markets, using it as collateral at the inflated price to borrow real assets. PeckShield later confirmed total losses at 8.7 million dollars, which exceeds the market value of all MAMO tokens. The stolen funds are now in a DAI stablecoin wallet. In response, Moonwell set borrow caps for all Core Markets on Base to 1 wei, blocking new loans while allowing withdrawals. This incident follows previous losses due to pricing failures, totaling over 14 million dollars in ten months. The broader sector faces similar vulnerabilities, with analysts attributing losses to economic design failures rather than code issues. Moonwell plans to provide further updates as they assess the situation.

This content is provided for general informational purposes only and doesn't constitute financial, investment, legal, or tax advice. Any events, rewards, online promotions, or related information mentioned herein should not be considered a recommendation, solicitation, or invitation to purchase, sell, trade, or otherwise deal in any crypto assets. Crypto assets are highly volatile and may result in loss. The availability of WEEX services, products, and related events may vary by region. You are responsible for ensuring that your participation is in accordance with applicable local laws and regulations.