Loopscale, a Solana-based decentralized finance (DeFi) protocol, has temporarily halted its lending markets after suffering a $5.8 million exploit. The breach occurred on April 26, when a hacker stole approximately 5.7 million USDC and 1,200 Solana (SOL) tokens by manipulating the RateX PT token pricing functions and taking out a series of undercollateralized loans.
- *Exploit Impact*: The exploit only affected Loopscale's USDC and SOL vaults, representing around 12% of the protocol's total value locked (TVL) of approximately $40 million.
- *Response*: Loopscale has re-enabled loan repayments, top-ups, and loop closing, but other app functions, including vault withdrawals, are still temporarily restricted while the team investigates and ensures mitigation of the exploit.
- *Investigation*: The team is fully mobilized to investigate, recover funds, and ensure users are protected, with co-founder Mary assuring users that they are working on a resolution.
- *Unique DeFi Lending Model*: Loopscale uses an order book model that directly matches lenders and borrowers, rather than pooling deposits, supporting fixed-rate, fixed-duration loans and specialized lending markets.
- *Backing*: The protocol is backed by Solana Labs and Coinbase Ventures, and has attracted over 7,000 lenders with yields exceeding 5% and 10% for USDC and SOL vaults, respectively.
