Crypto News 10/29/21
Trouble brewing in Defi… A couple days ago Cream Finance was hacked ( again) for $130 million dollars. One anonymous person out there executed a flash loan attack and found a hole in the Cream smart contracts. This resulted in the tokens being withdrawn from their platform and in the end, they are down about $130 million dollars.
The above chart is the two week chart of Cream. You can see exactly when the news of the hack started spreading. If you were unfortunate enough to be holding Cream governance token, you lost a cool 30% in a matter of minutes.
These stories are important to read about. You must know the dangers of being invested in this space. Your investing in an entirely new financial system. With new innovations there is always failures and pitfalls as people experiment with the new technology. If you hold any DeFi tokens it is not impossible that this type of exploit would happen to your investment. It is a risk we are all taking. If you want to take a chance at great reward you must be willing to take on some risk.
Interestingly enough, since everything is public on the blockchain you can go back and look at the exact transaction that stole the money.
Here is the wallet, you can see whoever did the exploit is actively trying to launder the money and eliminate the trail.
To add to the mystery, the hacker left a note that says Aave was also vulnerable to the same attack. They also make a comment about incest because the Yearn developer often posts odd hentai pictures of young women. Strange times indeed.
The important thing to note is that the same vulnerability was found on Aave.
Banteg, the character who posts hentai, pointed out that this Aave vulnerability left over 10 BILLION dollars at risk.
If Aave got exploited for 11 figures I really don’t know what would happen to crypto. It is entirely possible it could have sent us into a multi year bear market.
The complexity that we are dealing with is hard to grasp because we are not developers or programmers. But it is important to understand that these risks exist. The devs do their best to make sure they don’t get exploited, but when your building an entirely new financial system from scratch, your bound to have a few bumps. Furthermore, all of these exploits further cement my conviction into Bitcoin. People make fun of Bitcoin because it cannot handle Defi. The throughput is just too slow. However, in cases like this, it becomes apparent why Bitcoin is special. It is easy, it is crisp, it works as intended, and never gets exploited. It doesn’t do much, but it does the job perfectly every time.
Curve/Convex Ripping
Congratulations to anyone who listened to me shilling Curve and Convex the previous few months. Convex is now $32 dollars, I think I first posted about it here when it was under $5. Curve is floating around $5 but I expect more upside soon. With almost 90% CRV staked and protocols actively trying to accumulate CRV, we may hit escape velocity sooner rather than later.
Ethereum Hits ATH
Ethereum has broken all time high. Very positive news for alt coins. I hope to see Ethereum at $10,000 before the end of this bull run but I am a bit cautious to make that official prediction. The entire market seems to be convinced that we will see $90,000 BTC and $10,000 Eth. Anytime the entire market agrees that something is going to happen, usually we get the opposite. That being said the U.S. government is till dysfunctional and does not know how to do anything except print more money. I do not believe they are going to suddenly increase rates and stop printing. But stranger things have happened. If they do decide to go this route, it will likely end the crypto bull market.
Goodluck with your investing and stay safe out there. When in doubt, buy safe protocols that you can trust. Bitcoin/Eth…
-Matt