A few more details have come to light regarding the recent DeFi hack. The bZX theft raised a lot of questions, and some answers have now been provided.
Figures indicate that roughly $360,000 worth of Ether has been earned by a criminal through the platform.
A Complex bZX Story Unfolds
He somehow obtained a flash loan of nearly $3 million in Ether.
With the money, the hacker managed to send half to Compound – a DeFi application – and the other half to bZX.
Through Compound, the hacker borrowed WBTC, while shorting the same asset on bZX.
To top it all off, the funds from Compound were sent to UniSwap to artificially create a WBTC price crash.
All of this worked out quite well, albeit it took some serious work.
For a fee of $8.71, the hacker managed to complete everything in one transaction.
That approach is crucial, as it allowed him to repay the loan automatically and take the profit accordingly.
The loan did not even require a collateral either, making this method very appealing to tricksters.
For lenders, flash loans offer many benefits.
They get their money back at all times, either normally or because the flash loan conditions aren’t met and the transfer is cancelled.
All of this goes to show how crafty one can get with DeFi, either for better or worse.