Major DeFi Hack :UwU Lend Loses $20 Million In Crypto

UwU Lend faces a loss of $20 Million in Cryptocurrency on 10 June 2024. Web3 security company Cyvers posted on X about the ongoing hack. It was the first company to inform about the hack to UwU Lend and the public. The company identified the hack as a $14 million loss. However, it reached $20 million in an hour. Crypto hacks are rising day by day. 2024 records more hacks in comparison to the numbers in the previous year.

What Is UwU Lend?

UwU Lend is a protocol where the crypto holders can deposit, lend or borrow cryptocurrencies. Those who deposit cryptocurrency get interest on it. While those who need crypto for any purpose borrow from the platform for zero-interest loans with no fixed repayment date. You can pay it back at your convenience. To borrow from the platform, you need to give collateral of more than the amount you are borrowing. This way the platform mitigates the risk of default. It is a new DeFi platform that works similarly to other DeFi lending platforms. Now, let us get deeper into the UwU Hack below.

UwU Hack Explained

Uwu Hack took place on 10 June 2024. Under this hack, the hackers stole around $20 million of cryptocurrency from the platform. They played so smart that no one knew about it till they stole $14 million. Cyvers informed about the hack to UwU Lend and the public on X. It is a Web3 Security company taking care of the possible threats on the blockchain technologies, DeFi platforms, and other decentralised technology. Thus, Cyvers made the first alert about the hack after UwU lost $14 million. After the first alert, the hack amount reaches $20 million in around half an hour.

According to the details, the hackers stole assets like WBTC and DAI. The possibility is that they convert them into a cryptocurrency that is easy to liquidate like ETH. Cyvers conducted the investigation after the hack. They came to know some crucial details about the incident which are as below.

  • The hackers get to know about a flaw in the UwU Lend Smart Contract through which they stole the cryptocurrency.
  • The hackers completed three transactions in six minutes for the successful hack worth $20 million.
  • The attackers took the support of Tornado Cash to anonymise their transactions and identity.

How Tornado Cash Plays A Crucial Role In The UwU Hack?

Tornado Cash is a tool that helps in mixing crypto transactions. If you put your cryptocurrency on Tornado Cash, it will mix it up with other users’ cryptocurrency. You can withdraw an equivalent amount but not necessarily the exact same coins you deposit. Thus, its positive use case will be to hide the identity of the crypto holder for safety purposes. However, attackers can use it to make it difficult for anyone to track the stolen currency by anonymising the identity. The tracking becomes almost impossible with the use of such tools.

Why Crypto Hacks Increasing In 2024?

The crypto hacks are rising day by day. The possible reason for the increase in such hacks is the increase in the valuation of cryptocurrencies. According to the data, 2024 records digital assets hack worth $542.7 million in the first half of the year. It is almost double the hacks amount in the first half of 2023. DeFi are prone to hacks through a loophole or weakness in their smart contracts.

On the other hand, private key leaks also play a crucial role in promoting these hacks. If we talk about UwU Lend, it is a comparatively new DeFi platform. Thus, it will lead to difficulty for the platform to regain people’s trust as well. Read our other crypto-related articles here.

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Garima Kaur is a student and an author at Charcha Times. She is passionate about exploring the dynamics of business world, startups, share market, and crypto.

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