DeFi Protocol Platypus To Refund 63% of Funds Lost In Recent Exploitation

Zinger Key Points
  • Platypus implements comprehensive compensation plan for users following exploitation.
  • The protocol is in in communication with Binance to address the issue of the BUSD assets that remain trapped.

Days after Platypus suffered major exploitation resulting in a loss of $9.1 million from three separate attacks, the decentralized-finance (DeFi) protocol announced a minimum of 63% of the funds would be distributed to users, regardless of any further update on fund recovery.

What Happened: On Feb. 16 at 7:16 p.m. UTC, Platypus was exploited, resulting in a significant loss of $9.19 million.

The first attack was the theft of approximately 8.5 million assets, which included USD Circle USDC/USD, Tether USDT/USD, USDC.e, USDT.e, DAI.e and BUSD BUSD/USD, Binance's stablecoin.

The second attack resulted in approximately $380,000 worth of assets mistakenly sent to the Aave v3 contract, and the third attack with the theft of assets valued at approximately $287,000.

After the attacks, around 35.4% of the funds remained in the main pool.

The surplus Platypus kept in the main pool will be fully utilized to compensate the affected LPs (liquidity providers) for their losses.

As Platypus recovered 2.4 million USDC (17.7% of pre-attack assets) from the attack contract, approximately 53.1% of the pool funds would be refunded to affected LPs.

Also Read: Australian Securities Regulator Reviews Binance's Derivatives Business

The Avalanche-based protocol also discussed with various parties about helping recreate stablecoins trapped in the attack contract.

In the compensation plan, Platypus would ensure a minimum of 63% of the funds distributed to users, regardless of any further update on fund recovery.

In addition, if the proposal submitted to Aave is approved and Tether confirms reminting the frozen USDT, Platypus would be able to recover approximately 78% of the user’s funds.

Platypus stated it was in constant communication with stablecoin issuers to recover the lost stablecoins and to facilitate negotiations, the treasury would be set aside for six months.

If the situation did not improve, the full 1.4 million (10.4% of pre-attack assets) would be distributed to all affected LPs.

Read Next: IMF Calls For Coordinated Action To Address Risks Posed By Crypto Assets

Photo: Courtesy Platypus

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Posted In: CryptocurrencyNewsMarketsAaveAva LabsBinancecryptocurrency attackdecentralized financeDeFiexploitationPlatypusStablecoins
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