DeFi

Acala Operations Have Been Full Resuming But aUSD Still Lost Its Peg

Three weeks after a significant security breach, Acala said on Wednesday that it had completely restored its services to users. This follows the approval of the third and final vote by its governance body.

Acala Operations Have Been Full Resuming But aUSD Still Lost Its Peg 4

The developers of the project announced on Twitter:

Acala is an app-specific parachain that seeks to be Polkadot’s finance hub. Acala had a security breach on August 13 as a consequence of a coding misconfiguration in a smart contract that managed a liquidity pool.

When liquidity providers (LPs) withdrew their assets, the misconfiguration caused them to error mint almost 3 billion aUSD. Approximately 300 addresses have illegally taken out 3.02 billion aUSD from their wallets. As a result of the incident, the aUSD lost its peg to the US dollar.

When this was discovered, the team immediately halted the network by an emergency governance vote. As a result, the team froze and incinerated the vast majority of burned funds traced on the Acala network.

Acala Operations Have Been Full Resuming But aUSD Still Lost Its Peg 5

The Acala governing committee opted to activate the network in its initial phase on September 26, allowing users to manage or liquidate their holdings while advanced services such as oracles and collateralized lending remained unavailable. These services have now been activated in an attempt to restore the DeFi chain to its pre-exploit form.

However, the aUSD price is now still trading at $0.809 according to the CoinMarketCap data.

aUSD price chart. Source: CoinMarketCap

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Harold

CoinCu News

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.