Polygon’s DeFi protocol, QiDAO, fell victim to a smart contract attack that resulted in a loss of approximately $13 million. However, this incident did not affect the user’s assets.

QiDAO is the next project to be hacked

QiDAO is a DeFi protocol that allows users to borrow stablecoins at 0% interest on their holdings. The project confirmed the attack via Twitter. However, the team emphasizes that the vesting contract was exploited through a vulnerability in Superfluid, a smart contract framework on Ethereum that allows users to transfer assets on-chain instead of QiDAO itself.

Superfluid’s exercise contract for QI has been exploited.

User funds on QiDao contracts stay safe. The exploit only affects Superfluid.

We will post an update when we know more.

— Qi Dao (@QiDaoProtocol) February 8, 2022

“The Superfluid Array’s vesting contract was exploited. User assets in QiDAO contracts remain secure. This is a separate exploit for the Superfluid suite of products. We will quickly update the latest developments.”

While QI insists that users’ funds remain safe, only the contract to lock the project’s governance token was stolen by the hacker. However, crypto analytics firm SlowMist estimates that hackers stole more than $13 million in various tokens including QI, WETH, USDC, SDT, MOCA, STACK, sdam3CRV, and MATIC.

Users are urged to exercise caution and avoid interacting with Superfluid Smart Contracts until further notice. This news prompted the market to react quickly, the price of QI quickly plummeted more than 70%, partly because the stolen token was the co-admin of QI and there are concerns about hackers looking for liquidity to buy it distribute tokens.

QI/USD 4H chart | Source: TradingView

QI price fell from $1.24 to $0.18 before recovering to $0.78 at press time. The attack also comes a day after Polygon raised $450 million in a funding round led by Sequoia Capital India.

Join CoinCu Telegram to keep track of news: https://t.me/coincunews

Follow CoinCu Youtube Channel | Follow CoinCu Facebook page