Arcadia Finance: A Victim of Code Vulnerability

Arcadia Finance, a noncustodial DeFi protocol, recently fell victim to a hack due to a code vulnerability, resulting in a loss of about $455,000.

Arcadia Finance: A Victim of Code Vulnerability

The stolen funds were primarily from Optimism and have been laundered via Tornado Cash. However, the stolen Ethereum tokens remain in the suspected wallet address.

The Role of PeckShield in Uncovering the Hack

Blockchain investigator PeckShield was the first to alert about the hack, attributing the root cause to “the lack of untrusted input validation.” This loophole allowed the hacker to drain funds from Ethereum (darcWETH) and Optimism (darcUSDC) vaults.

Despite Arcadia Finance confirming the hack and pausing contracts to prevent further losses, another vulnerability in Arcadia’s code remains a potential threat.

The State of Crypto Hacks in Q2 2023

In Q2 2023, hacks and exploits in the crypto space led to cumulative losses of over $300 million. According to a report by blockchain security company CertiK, the BNB Smart Chain recorded the most incidents, leading to significant losses. Despite a 58% decline in the number of crypto hacks compared to the previous year’s Q2 data, the threat remains substantial.