Based on reports, a seemingly catastrophic loss on Terra‘s Mirror Protocol was just averted at the last minute.
Key takeaways
- The Mirror protocol stopped an exploit that started yesterday and resulted in a loss of around $2 million.
- The stalled project has some assets affected to prevent funds from being further withdrawn.
- The mirror log could be minutes away from collapsing as the pools may have been emptied when markets opened today.
The Terra Mirror protocol solved an ongoing exploit that caused the network to lose over $2 million yesterday.
Mirror Protocol disables affected pools
An attack on the platform began yesterday, May 30, when flawed price oracles allowed attackers to siphon off funds.
The problem arose because these oracles did not match Tera (LUNA) and Terra Classic (LUNC) prices, giving the attacker the opportunity to get the most valuable asset cheaply and exchange it for other used assets through the Mirror Protocol.
Terra community member FatMan wrote on Twitter that the issue is now resolved as the platform has disabled mBTC, mETH, mDOT, and mGLXY as side options. These funds were originally the target of the attacker during the original exploit.
“The attacker can no longer use their illegal donation to drain the rest of the pools,” he posted this morning.
The project was on the verge of collapse
It seems that the platform was on the verge of collapse due to exploitation and lost funds in the process.
Another user, Rizman Zoom, wrote that the affected assets are available at a 97% discount this morning. This meant that platform’s pools could have been quickly drained of funds as US markets opened today.
“Mirror Protocol is dying today,” wrote Rizman Zoom on Discord. “If they don’t suspend mBTC, mETH, mDOT and mGLXY from being used as collateral for minting within the next 25 minutes, the Mirror protocol will be exploited to death.”
Just before the issue was resolved, FatMan wrote that the protocol was only 16 minutes away from death. This suggests that the platform was really on the verge of failure.
This is the second recent attack on the Mirror protocol. Another attack in October 2021 went unnoticed until last week, when it was discovered to have cost the protocol $90 million.
