• French police have arrested two people in connection with an attack on the decentralized finance (DeFi) protocol Platypus.
• Platypus stated that it has recovered 2.4 million USDC and 687,000 BUSD out of the $9 million in stolen assets.
• The attack against Platypus used a flash loan and was similar to the attack structure used against Mango Markets late last year.
Attack on DeFi Protocol Platypus
French police have arrested two people in connection with an attack on the decentralized finance (DeFi) protocol Platypus. According to a statement from France’s police department, approximately $220,000 in cryptocurrency was seized as part of the arrest.
Assets Recovered by Platypus
Platypus stated in a blog that it has recovered 2.4 million USDC and 687,000 BUSD out of the $9 million in stolen assets and that it has also worked with Tether to freeze 1.5 million USDT. USDC, USDT, and BUSD are all stablecoins designed to mirror the value of fiat currencies such as the U.S. dollar.
Structure of Attack
The attack against Platypus used a flash loan and was similar to the attack structure used against Mango Markets late last year. Flash loans aren’t inherently bad; they were designed to be a tool for traders looking for arbitrage opportunities. This attack exploited a logic flaw in USP’s smart contracts, which are constantly checked for solvency. The attacker used borrowed crypto from Aave to provide liquidity to a Platypus trading pool before borrowing USP stablecoins against their LP positions and repaying the flash loan by withdrawing everything back to Aave .
Funds Returned To Users
Platypus earlier announced that it intends to return at least 63% of funds to users after recovering a portion of the $9 million drained from the protocol last week.. The team also thanked Binance and ZachXBT for their assistance in determining the identity of the attacker .
Total Value Locked (TVL)
Platypus is an Avalanche blockchain-based automated market maker (AMM) focused on stablecoins with a total value locked (TVL) of $39.5 million according DeFiLlama Its TVL has dropped significantly from its high of $1