The decentralized finance (DeFi) sector continues to attract heightened attention from crypto investors. ForkLog has compiled the most important events and news of the past weeks into this digest.
Key metrics of the DeFi segment
Against the backdrop of the crypto industry crisis, the total value locked (TVL) in DeFi protocols fell to $78.89 billion. The leader in this metric is the lending protocol Aave ($10.48 billion). Second and third places in the ranking are MakerDAO ($7.93 billion) and Curve ($5.51 billion), respectively.
TVL in Ethereum applications fell to $46.03 billion. Over the last month, the USD-denominated figure fell by nearly 40% (May 25 — $75.49 billion). In ETH, the quantity decreased by just 0.5%, to 37.44 million coins.
Trading volume on decentralized exchanges (DEX) over the last 30 days amounted to $76.5 billion, according to Duna Analytics.
Uniswap continues to dominate the non-custodial exchange market — accounting for 56.9% of total volume. The second DEX by trading volume is Curve (20.3%), the third is Synthetix (8.7%).
Hacker stole approximately $100 million in cross-chain Horizon bridge attack on Harmony
The Harmony blockchain platform team reported an attack on the cross-chain Horizon bridge, as a result of which the attacker stole assets worth about $100 million.
According to Certik, the attacker gained control of a multisig wallet. The unknown actor moved tokens in several transactions, then sent them to another wallet and swapped on the Uniswap decentralized exchange.
Developers paused Horizon. They also stated that they began an investigation in cooperation with law enforcement, including the FBI, and notified cryptocurrency exchanges about the situation.
The team assured that the incident did not affect the trustless Bitcoin bridge — all assets are safe in decentralized storage.
Chainlink team announced staking launch
The Chainlink decentralized oracle network developers announced the deployment of a staking mechanism for LINK tokens in the second half of 2022. The team noted that the move would enhance the ecosystem’s security as it scales.
According to the statement, the staking mechanism will achieve four long-term goals:
- increase network security and provide guarantees to users;
- ensure community involvement in Chainlink’s work;
- generate and distribute rewards for stakers;
- create a reputation framework for selecting nodes in decentralized oracle networks.
According to the developers, the first phase aims to create a ‘reliable and simple foundation that will allow gathering feedback’. Over time, staking’s use cases will expand, and its structure will be made more complex.
Osmosis blockchain paused due to critical vulnerability
On June 8, the Osmosis Cosmos ecosystem paused block production due to a vulnerability that could have led to depletion of the Osmosis DEX liquidity pools.
Reddit users were the first to notice the exploit. One noted that the vulnerability allows adding liquidity to a pool and withdrawing it to receive 50% more than the deposited amount.
Developers explained that the exploit became possible due to a bug present in Osmosis v9, which was activated on May 7.
The bug involved incorrect calculation of liquidity providers’ shares when adding and removing assets from pools. It was missed during internal testing of the update.
The project team needed several days to restore operations. Osmosis resumed block production on June 12.
Attacker hacked DNS servers of DeFi projects among Namecheap clients
Since June 23, a number of DeFi projects, including Convex Finance, Allbridge, Ribbon Finance and DeFi Saver, faced DNS-server attacks. All of them used Namecheap’s domain registrar services.
The attack vector in all cases was similar: an unknown attacker took control of the project’s DNS server and urged users to approve malicious smart contracts.
Allbridge co-founder Andrey Veliky told ForkLog that about 23 crypto projects faced DNS attacks. He added that the group of victims is considering filing a lawsuit against the provider.
Namecheap largely remained silent for about a day, but on the evening of June 24, the company’s chief executive Richard Kirkendall said on Twitter that the provider identified a ‘compromised agent’ and removed access.
DeFi sector venture funding in May fell to $176.3 million
In May, the total volume of DeFi-focused venture deals amounted to $176.3 million. This is the lowest figure since September 2021.
In total venture investment inflows into the blockchain industry, DeFi’s share fell to 9% from 18% in April.
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According to analyst John Dantoni, for the first time since July 2020, funding for DeFi projects did not rank among the two most popular deal types in the sector.
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