DeFi Platform Wise Lending Falls Victim to Hack

Wise Lending reportedly suffered an exploit on Friday in the latest cybersecurity breach in the decentralized finance (DeFi) space. PeckShield Inc., a blockchain security and data analytics company, reported that Wise may have suffered a significant loss of approximately 177 ETH, about the market price of $464,000.

PeckShield’s initial investigation revealed that the exploit was due to a flaw in the share accounting logic of Wise Lending. The flaw is tied to a precision issue that enabled the draining of market funds, as per the firm.

Meanwhile, Wise Lending is yet to respond to the incident at press time.

The security firm explained that the attackers manipulated a near-empty market, PLP-stETH-Dec2025, to artificially inflate the share price. Once inflated, they proceeded to borrow most of the funds from the lending markets.

The @Wise_Lending market was exploited today, resulting in ~177 ETH loss (~$464K).

Our initial analysis shows the share accounting logic is flawed with a precision issue to drain the market funds.

Here is the related hack tx: https://t.co/aadbYIjX9o pic.twitter.com/FEtWW1wzKH

— PeckShield Inc. (@peckshield) January 12, 2024

Flash loan attacks become frequent

A crypto community member who goes by the handle @charliemktplace on X explained that Oracle manipulation of the Pendle token led to a 7% price fluctuation against Ethereum. And because of a flash loan attack on AAVE v2, there was a significant price swing. It was then reportedly exploited to drain assets from the Wise Lending platform.

CertiK, another player in blockchain security, flagged the incident as well. They revealed that the exploit was executed through a malicious flash loan. The stolen funds were tracked to an externally owned account (EOA). It raised concerns about the vulnerability of such platforms to sophisticated attacks as we enter 2024.

Just last week, cross-chain lending protocol, Radiant Capital, was compromised. It reportedly resulted in the theft of 1900 ETH. The hack was valued at approximately $4.5 million.

After the incident, Radiant reportedly halted lending and borrowing.

Last year’s security breaches in the DeFi space, including Onyx Protocol and Euler Finance, are also reminders of risks becoming more nuanced. Onyx Protocol lost $2 million to a flash loan exploit, and Euler Finance was drained of a staggering $197 million.

The repeated pattern of exploits indicates a need for improved security. And DeFi industry needs to find ways to safeguard investors’ assets and maintain trust in decentralized financial systems.

Shraddha’s professional journey spans over five years, during which she worked as a financial journalist, covering business, markets, and cryptocurrencies. As a reporter, she has placed particular emphasis to learn about the market interaction with emerging technologies.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.