Crypto Platform Raft Suffers $3.3M Exploit, but Hacker Likely Lost Money on Attack.

Nov 11, 2023 at 12:21 pm
By Afsal Ahammed

Crypto platform Raft recently experienced a $3.3 million exploit, but intriguingly, the hacker appears to have incurred losses in the course of the attack. This unexpected turn adds a twist to the incident, raising questions about the motives and outcomes of the security breach.

Crypto Platform Raft Suffers $3.3M Exploit, but Hacker Likely Lost Money on Attack.

Decentralized finance (DeFi)or Crypto platform Raft was targeted by a hack on Friday, resulting in a loss of approximately $3.3 million in ether (ETH). However, the attacker may have ended up losing money in the process.

According to on-chain data, the hacker drained 1,577 ETH from Raft, but then sent 1,570 ETH to a burn address, effectively destroying most of the stolen assets. Only 7 ETH remained with the attacker. Before the attack, the hacker had received 18 ETH through a crypto mixer service called Tornado Cash, presumably to fund their transactions. After paying the blockchain fees, the attacker was left with just 14 ETH, resulting in a net loss of 4 ETH.

Following the exploit, Raft’s R stablecoin pegged to the US dollar, experienced a significant drop in value, plummeting by as much as 50%. However, the stablecoin later rebounded to around 70 cents, according to Coinmarketcap data.

Raft co-founder David Garai confirmed the attack in a post on X (formerly Twitter), explaining that the attacker minted R tokens and sold them to drain automated market maker liquidity. Simultaneously, collateral was withdrawn from Raft.

Garai stated that the team is working to reimburse affected users using the protocol-owned sDAI in the Peg Stability Module. Raft is a DeFi lending platform that issues the R stablecoin collateralized by liquid staking ether derivatives, such as Lido’s stETH. Users can obtain R tokens by locking up ETH derivatives.

Interestingly, this was the second major crypto exploit that occurred on Friday. Earlier in the day, a hacker managed to drain around $114 million in digital assets from the centralized exchange Poloniex.

Despite the successful attack on Raft, the hacker did not walk away with significant profits. The decision to send most of the stolen assets to a burn address, combined with the decline in the stablecoin’s value, resulted in the attacker losing money on the overall maneuver.

Crypto platform Raft will now focus on recovering from the attack and implementing measures to prevent future exploits.