The decentralized finance (DeFi) protocol Venus acknowledged an issue involving one of its price feedback oracles on December 11, leading to borrowings amounting to around $270,000. Despite this development, Venus attempted to diminish the severity of the incident, referring to it as an analyst-described "breach," and committed to replacing Treasury funding affected by the issue.
Reports surfaced on December 10 indicating a price oracle malfunction that impacted the decentralized lending market built on Binance Smart Chain. SaulCapital, a former Twitter user, notified followers about the exploitation of the segregated pool handling liquid collateralized BNB on the Venus protocol. The incident involved a wallet address linked to approximately $260,000 in holdings.
Responding to these concerns, a Venus Protocol ambassador, NoOneVII, clarified that the problem appeared to be related to an oracle price issue confined to a small, isolated market. He emphasized the independence of the Venus Core Pool and other pools, asserting no broader security issues. Brad, head of Venus Labs, confirmed that the Binance oracle backing the snBNB asset in the segregated pool had reported incorrect prices, resulting in approximately $200,000 in borrowings.
Venus Protocol announced plans on December 11 to release more comprehensive details soon, reassuring the community that the $snBNB prices had returned to normalcy, with the core pools and other markets remaining unaffected and funding deemed safe ("SAFU"). The protocol also mentioned an upcoming proposal by the Venus community to infuse liquidity of approximately $274,000 from the Treasury into the impacted pools while concurrently withdrawing funds with the assistance of partners.
DefiLlama data indicates that the total locked value in DeFi protocols initiated in 2020 did not seem to be influenced by the incident, holding steady at $738 million. As of the latest update, the native token of the platform, Venus (XVS), experienced a 17.5% decrease over the past 24 hours, currently valued at $9.56. However, much of this decline aligns with a broader market downturn in the cryptocurrency space.
