PANews May 30 reported that a trader lost over $500,000 due to anomalies in the VWAP mechanism of the Chainlink oracle, according to The Block. The incident originated from the Ethereum-based MEV bot JaredFromSubway making a large transaction of $210,000 in the Curve deUSD/USDT pool, causing the price of deUSD to briefly spike to $1.03 in a low liquidity market. This price fluctuation was transmitted to the Avalanche network through the Chainlink oracle, triggering the liquidation of user positions on the Euler lending platform.
Chainlink supporter 'ChainLink God' explained that the oracle uses a full market VWAP pricing mechanism, and deUSD has been flagged as a 'high-risk asset.' Omer Goldberg, founder of Chaos Labs, pointed out that using VWAP in illiquid pools has design flaws and suggested implementing price caps or outlier-resistant algorithms for stablecoins. Data shows that of the total supply of $185 million deUSD, $42.7 million is circulating on the Avalanche chain.
