Term Labs Suffers $8.5 Million Loss in Governance Attack

The DeFi platform Term Labs faced a large-scale cyberattack that resulted in asset losses totaling approximately $8.5 million. The incident occurred due to a critical vulnerability in the protocol’s governance system, allowing an attacker to gain control over the Term Meta Vaults.

Details of the Hack and Fund Withdrawal Methods

Analysts from PeckShield and CertiK confirmed that the hacker withdrew 2843 ETH (equivalent to $6.87 million) and 1.68 million USDC. The withdrawn stablecoins were quickly converted into 1.68 million DAI. It was noted that to fund the attack, the attacker initially topped up their wallet with 2 ETHd to the address 0xD5183d8BfC65a50863C62aF2538198A8288FFc13

“The DeFi protocol Term Labs was attacked due to a vulnerability in the governance system. According to analysts from PeckShield and CertiK, the losses amounted to approximately $8.5 million.”

Response from Term Labs and Next Steps

The Term Labs team officially confirmed the attack and emphasized that the issue arose specifically in the governance system of the vaults. For security reasons, it was decided to permanently halt the operation of Term Meta Vaults and revoke all DAO governance roles, making new deposits impossible. Despite this, users still have the ability to withdraw their funds from the vaults.

Preliminary findings from the investigation indicate that the main Term protocol and its direct lending and borrowing markets were not affected by the attack. The team is currently collaborating with external security specialists to minimize the incident’s impact and recover the stolen assets. If a funding shortfall remains after the investigation is completed, Term Labs will consider various compensation options for users.

The company promised to regularly inform the community about verified updates regarding the situation and urged users to remain vigilant to avoid becoming victims of scammers who may impersonate project representatives.

Source: finway.com.ua