Liquity scare hits DeFi as Ethereum Foundation sinks $120M into sector
While the frequency of once-common nine-figure hacks has waned in recent months, the decentralized finance (DeFi) sector remains a dangerous place. An $85 million scare and a $9.5 million hack have directly preceded the Ethereum Foundation’s show of confidence in DeFi, as it deposits $120 million of ether (ETH) into key protocols Aave, (Maker spin-off) Spark, and Compound Finance. However, just yesterday, users of DeFi protocol Liquity V2 were advised to withdraw their funds, after the team discovered a “potential issue” in the project’s Stability Pools. Liquity, the issuer of LUSD and BOLD stablecoins, is an immutable protocol and therefore unable to pause or upgrade the affected pools. In the event of a critical vulnerability, it would be up to users to be aware of the issue and withdraw any funds. The Liquity team was informed of a potential issue affecting Liquity V2 Stability Pools (“Earn”), and is currently investigating a potential impact. The team is currentl...