Free DAO, the DeFi protocol, faced multiple flash loan attacks, resulting in a $1.25 million loss and a 99% drop in the price of the original token after the attack.
Unlike regular loans, the Flash loan feature allows users to borrow large amounts of assets without any upfront collateral. The only condition is that the loan must be repaid in a single transaction. This is often used by bad actors to steal large amounts of assets in the DeFi protocol.
Blockchain security firm CertiK alerted the crypto community on Thursday. Regarding the 99% drop in price of NFD tokens due to Flash loan attack, the attacker reportedly used an unverified contract and called a function. “addMember()” to add yourself as a member. The attacker subsequently carried out three flash loan attacks.
Hugh Brooks, Director of Operations Safety It said the vulnerability was in an unverified rewarding contract implemented by the New Free DAO project. So we don’t know the real cause.”
CertiK also states that the hackers behind the Flash Loan attack on NFD are related to “those who are involved”.attack Neorder (N3DR) in May earlier this year, later another blockchain security firm Beosin, said the attackers behind the two hacks could be the same person, Certik confirmed as well, and said:
“The funds stolen in the $N3DR attack were sent to EOA 0x22C9… which is the same wallet that received the stolen funds from this attack.”
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