Cover Protocol suffered a hacker attack: the price fell by 97%

The peer-to-peer Cover marketplace is just the latest in a long line of DeFi protocols to be targeted by hackers

A hacker exploited a vulnerability present in the Cover staking protocol, issuing over 40 trillion „coins.“ However, surprisingly, the attacker returned the funds, leaving a message that said:

„Next time, be more careful.“

According to data from Bitcoin Evolution wallet explorer Nansen, during the initial exploit, the attacker sold over 11,700 coins on the decentralized exchange aggregator 1inch, after increasing the supply of tokens. In total, the attacker drained more than $5 million from the project.

Cover released a statement regarding the incident in a message posted on his Discord group, stating:

„The Blacksmith farming contract was hacked and infinite $COVER tokens were minted. We have restricted access to the contract to stop the attacker. If you are providing liquidity for $COVER tokens (on Uniswap or Sushiswap), please stop immediately.“

According to the Cover Protocol team, the issue only affected the supply of tokens, so funds in the „claim/no claim“ pools would still be safe. The developers claim to be investigating the incident.

As expected, the attack caused the price of the COVER token to plummet by over 97%, prompting many negative comments from some members of the crypto community on social media. In November of discussed integrating Cover Protocol with Yearn.Finance.

Monday’s incident is certainly not the only example of attacks launched against DeFi projects: throughout the year we have reported multiple hack attempts against numerous protocols.