On Thursday, a flash loan attack was discovered in the Inverse Finance decentralized finance (DeFi) protocol, with the hacker stealing over $1.2 million.
According to on-chain statistics, the anonymous offender carried out the hack utilizing a flash loan involving 27,000 wrapped bitcoin (worth approximately $579 million) at around 4:47 a.m. ET. The digital currencies exploited included 53 BTC and 100,000 USDT.
Flash loans are loans that demand the borrowed amount to be returned in the same transaction.
While flash loans are intended to improve capital efficiency and arbitrage trading, hackers have utilized them to influence DeFi price data feeds, known as oracles, and carry out exploits.
In April 2022, Inverse Finance was also drained in an exploit, in a multi-million dollar losses.