{"id":32506,"date":"2022-07-29T07:01:35","date_gmt":"2022-07-29T11:01:35","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=32506"},"modified":"2022-07-29T07:01:40","modified_gmt":"2022-07-29T11:01:40","slug":"solana-based-stablecoin-nirv-sees-an-85-decline-following-3-5m-attack","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/solana-based-stablecoin-nirv-sees-an-85-decline-following-3-5m-attack\/","title":{"rendered":"Solana-based stablecoin NIRV sees an 85% decline following $3.5M attack"},"content":{"rendered":"\n
The price of Nirvana Finance's stablecoin NIRV and native token ANA both dropped by almost 85% as a result of the $3.5 million flash loan assault.<\/h5>\n\n\n\n
\"Solana-based
Solana-based stablecoin NIRV sees an 85% decline following $3.5M attack<\/figcaption><\/figure>\n\n\n\n

Following a hack on the adaptive yield protocol Nirvana Finance on Wednesday, the Solana-based algorithmic stablecoin NIRV has now become the most recent stablecoin to collapse, falling 85% from its peg to the US dollar.<\/p>\n\n\n\n

The SolanaFM <\/a>team was the first to announce that the money was sucked out via a flash loan assault on Wednesday. The incident, which also saw Nirvana Finance's native token ANA collapse by 85%, cost $3.49 million worth of Tether (USDT).<\/p>\n\n\n\n

\u201cUtilizing Solend Protocol\u2019s Flash Loans, the hacker borrowed $10M USDC from the Solend Main Pool Vault which was used to exploit $3.49M USDT from the Nirvana Finance Treasury.\u201d<\/p><\/blockquote>\n\n\n\n

Both NIRV and ANA are currently down almost 85%, to $0.14 and $1.33, respectively, at the time of writing. The protocol was “maliciously compromised and reserve monies are taken,” according to Nirvana's website. NIRV and ANA no longer have their collateral, and their market value is not guaranteed.<\/p>\n\n\n\n

\n

What we know so far:

Nirvana has been maliciously hacked and the reserves have been stolen.

A flashloan attack was used to steal money. This is not the fault of Solend, but an exploit of Nirvana's program.https:\/\/t.co\/NkmtHAbAAa\r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a><\/p>— Nirvana \ud83d\udcff (@nirvana_fi) July 28, 2022<\/use><\/svg><\/span><\/a><\/blockquote>

The Nirvana team<\/use><\/svg><\/span><\/a> is now giving the hacker a $300,000 whitehat reward and the “cessation” of their identity probe. The hacker's wallet connected to a centralized exchange has been detected, according to what they have so far disclosed.<\/p>\n\n\n\n

\u201cPlease accept this good faith request and return our treasury for the good of the whole Nirvana community. You have not taken money from VCs or large funds\u2014the treasury you have taken represents the collective hopes of everyday people,\u201d it wrote.\u00a0<\/p>\n\n\n\n

\n

To The Nirvana Hacker:

On behalf of the Nirvana Finance community, we humbly ask that you return the stolen funds from our treasury. 1\/5<\/p>— Nirvana \ud83d\udcff (@nirvana_fi) July 28, 2022<\/use><\/svg><\/span><\/a><\/blockquote>

Another algorithm fails<\/h2>\n\n\n\n

The protocol unironically refers to the algorithmically collateralized NIRV as a “superstable” token. The asset is backed by a network of stablecoins in Nirvana's reserves via a “decentralized peg delegation,” according to an explanation thread on Solana Forums.<\/p>\n\n\n\n

\u201cNIRV is always treated as $1 from the protocol\u2019s point-of-view. This dollar value is denominated in ANA tokens<\/a>. For instance, if the spot price of ANA is $12, the protocol accepts 12 NIRV to purchase an ANA token.\u201d<\/p>\n\n\n\n

In this case, it appears that the $3.49 million worth of USDT that was taken from Nirvana's funds caused NIRV to be depegged. In 2022, it represents another another algo-stablecoin that has undergone a significant depeg. After the protocol was compromised in April for $182 million, Beanstalk Farm's algorithmic stablecoin is currently trading at $0.0022.<\/p>\n\n\n\n

The original iteration of Terra's algo-stablecoin TerraUSD Classic (USTC) notoriously crashed after a death spiral that caused the market to lose $40 billion in May.<\/p>\n\n\n\n

How it operated<\/h2>\n\n\n\n

A hacker allegedly deployed a software to fraudulently inflate the price of ANA from $8 to $24 using the flash loan, according to blockchain auditing platform OtterSec. They then swapped the asset for $3.49 million worth of USDT, which was taken directly out of Nirvana's treasury, in order to manufacture ANA against the inflated price of the flash loan.<\/p>\n\n\n\n

OtterSec pointed out that his breach was similar to the $10 million assault on Crema Finance earlier this month, in which the perpetrator borrowed money quickly through the Solend decentralized finance (DeFi)<\/a> protocol in order to fudge pricing information and raid the network.<\/p>\n\n\n\n

\n

1\/ @nirvana_fi<\/use><\/svg><\/span><\/a> was hacked for $3.49 M a few hours ago.

How did this happen? \ud83e\uddf5 pic.twitter.com\/1rAvIqM38c<\/use><\/svg><\/span><\/a><\/p>— OtterSec (@osec_io) July 28, 2022<\/use><\/svg><\/span><\/a><\/blockquote>

According to SolanaFM, the hacker ended the attack by using Wormhole's cross-chain bridge to convert “the complete USDT value into USDCet, moving the cash into an Ether (ETH) account.”<\/p>\n","protected":false},"excerpt":{"rendered":"

The price of Nirvana Finance’s stablecoin NIRV and native token ANA both dropped by almost 85% as a result of the $3.5 million flash loan assault. Following a hack on the adaptive yield protocol Nirvana Finance on Wednesday, the Solana-based algorithmic stablecoin NIRV has now become the most recent stablecoin to collapse, falling 85% from […]<\/p>\n","protected":false},"author":38,"featured_media":32510,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[10994,10993],"class_list":["post-32506","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-ana-token","tag-nirv"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/07\/0_yMwJO0ldkDf_PGs2.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/32506","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=32506"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/32506\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/32510"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=32506"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=32506"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=32506"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}