CDS Crypto News Arbitrum Optimism and Tron Successfully Avert Contagion from Curve Exploit
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Arbitrum Optimism and Tron Successfully Avert Contagion from Curve Exploit

Curve exploit contagion prevented by Arbitrum, Optimism, and Tron.

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Arbitrum Optimism and Tron Successfully Avert Contagion from Curve Exploit

According to a recent JPMorgan report, the impact of the recent attack on the DeFi protocol Curve Finance has been brought under control, containing the threat to the decentralized finance space. However, apart from exceptions like Tron, Arbitrum, and Optimism, the overall DeFi space is reportedly shrinking.

Arbitrum Optimism and Tron Successfully Avert Contagion from Curve Exploit

The JPMorgan team, led by Managing Director Nikolaos Panigirtzoglou, stated in the report that the contagion triggered by Curve Finance‘s exploits has been contained. Nevertheless, outstanding loans totaling over $80 million owed by Curve founder Michael Egorov pose a threat to the broader DeFi space, leading to the market’s shrinkage following the hack.

To address this, Michael Egorov has raised almost $30 million by mass selling Curve DAO Tokens (CRV) to defend the token’s price and avoid its value dropping to $0.37, which would trigger the liquidation of a $51 million CRV-backed debt on Aave, among other multimillion-dollar loans.

The JPMorgan analysts noted that the growth of the DeFi space has stagnated over the past year due to a series of high-profile hacks, scandals, and bankruptcies. The recent attack on Curve Finance further eroded investors’ confidence, prompting them to withdraw their funds.

Despite the challenges posed by the DeFi contagion, a few crypto projects, including Justin Sun’s Tron ecosystem and Ethereum Layer-2 scaling solutions Arbitrum and Optimism, have managed to shield themselves from the shockwaves of the Curve exploit. The analysts attributed the rise in their Total Value Locked (TVL) to their ability to offer faster and cheaper transactions to users who were otherwise facing network congestion and higher transaction costs on the Ethereum network.

Arbitrum Optimism and Tron Successfully Avert Contagion from Curve Exploit
Sources:coinedition

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