Hacked pool results in cryptocurrency funds being leaked due to inactive protocol

Smart contract vulnerabilities have once again been exploited by hackers, this time targeting the defunct decentralized finance (DeFi) lending protocol Yield Protocol. Yield Protocol, which shut down in December 2023 due to a lack of business demand and regulatory pressures, had repeatedly advised investors to close their positions, withdraw funds, and settle pending loans. However, despite these warnings, an unidentified hacker managed to steal approximately $181,000 worth of cryptocurrency assets from Yield Protocol’s strategic contracts on the Arbitrum blockchain. The hack was initially reported by blockchain investigation firm PeckShield and later confirmed by CertiK. CertiK’s subsequent investigation revealed that official support for Yield Protocol had ended on February 2 and the chances of recovering the stolen funds appeared slim. This incident follows a previous attack on Yield Protocol in March 2023 when it, along with 10 other DeFi protocols, suffered losses due to an attack on the noncustodial lending protocol Euler Finance. However, by July 2023, Yield Protocol had fully recovered from this attack. At the time, Yield Protocol collaborated with Euler Finance to recover the funds, deploying new contracts and executing permissioned calls to reset token maturities and restore the protocol. In related news, blockchain security firm Immunefi reported a 23% decrease in losses from hacking and scams in the first quarter of 2024 compared to the same period in 2023. The report revealed that approximately $336.3 million was lost to hacking and fraud incidents in Q1 of 2024, down from $437.5 million in Q1 of 2023. The report also highlighted 46 hacking incidents and 15 cases of fraudulent activities. Among the highest losses was cross-chain bridge protocol Orbit Bridge, which lost $81.7 million. Additionally, a magazine article discusses the performance of Runes, indicating that 68% of them are currently in the red and raising questions about their efficacy as a Bitcoin upgrade.