The post Loopscale loses $5.8M in oracle attack appeared on BitcoinEthereumNews.com.

This is a segment from the Lightspeed newsletter. To read full editions, subscribe. Loopscale Labs had one tough weekend. Bad actors on Saturday exploited Loopscale’s pricing functions to make loan collateral seem worth more than it really was, resulting in the theft of approximately $5.7 million in USDC and 1,200 SOL (or around 12% of the platform’s total assets.) It’s obviously not ideal to suffer an exploit just two weeks after launching, but this isn’t your typical “DeFi protocol caught with its pants down” moment. On the contrary, many DeFi folks have rallied behind Loopscale’s response to the exploit, applauding the team’s speed, professionalism and commitment to user recovery.  Loopscale USDC and SOL vault depositors do face losses, though early signs seem to point to a partial or even full recovery.  For those unfamiliar, Loopscale’s story ‘til now unfolds thusly.  Loopscale is a decentralized finance (DeFi) project that automates recursive leverage to make yield farming more efficient. Loopscale’s bread and butter is “looping” — repeatedly borrowing and redepositing assets to amp up yield and capital efficiency. They weren’t the first team to try to morph this premise into a mainstream financial primitive, but they have quickly become one of the most compelling. Honestly, it’s pretty neat work. While the looping process has historically been dangerous, Loopscale’s system offered automation, liquidation protection features, and a user experience that abstracted away many of those perceived risks. Loopscale’s vaults, known for their attractive yields and tokenized market integrations, became a favorite among farmers looking for structured, lower-friction leverage.  Founded by a small but technically-strong team — including Mary Gooneratne and a handful of early RateX contributors — Loopscale built a reputation as one of the more serious players among Solana’s DeFi cohort. At the core of Loopscale’s recent growth was its adoption of…

---

Filed under: News - @ April 28, 2025 9:26 pm