Venus, a decentralized finance (DeFi) protocol, acknowledged that it faced an issue with one of its price feed oracles on December 11th, resulting in borrowings amounting to approximately $270,000.
Despite being described as an exploit by some analysts, the platform downplayed the incident and committed to replacing the funds from its treasury.
Reports emerged on December 10th, indicating that a malfunctioning price oracle had affected the decentralized lending and borrowing marketplace based on the Binance Smart Chain.
A Twitter user, SaulCapital, informed followers of an issue with the “isolated pool on Venus Protocol for liquid staked BNB,” and shared a link to a wallet address associated with the incident, which held just under $260,000 at the time.
In response to these reports, Venus Protocol’s ambassador, NoOneVII, suggested that it was more of an “Oracle price issue” occurring in a small isolated market.
He reassured users that the Venus Core Pool and other pools were separate and unaffected by this problem, emphasizing that there was no security breach.
Brad, the Head of Venus Labs, confirmed that the Binance oracle had reported incorrect prices, resulting in approximately $200,000 in borrowings.
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Venus Protocol assured its community that the “$snBNB price feed is back to normal, Core Pool, and other markets are unaffected, and funds are SAFU (Secure Asset Fund for Users).”
Furthermore, Venus Protocol announced that the community would propose an immediate injection of liquidity from the treasury into the affected pool, totaling around $274,000.
This move would support the recovery of funds from the pool, with the assistance of partners.
Despite the incident, the total value locked in the DeFi protocol, launched in 2020, remained unaffected and stood at $738 million at the time.
The platform’s native token, Venus (XVS), experienced a 17.5% decrease in value over the past 24 hours, trading at $9.56, although this decline was partly attributed to the broader cryptocurrency market sell-off.
In conclusion, Venus Protocol faced a price oracle issue resulting in borrowings of $270,000, but it assured users of the security of its other pools and pledged to replace the funds from its treasury.
The incident did not significantly impact the total value locked in the protocol, and the token’s price decline was in line with market trends.
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