By
Svetlana Soroka
July 29th, 2023
Leshner revealed that the bug that happened as a result of the upgrade exposes another 2020,472.5 COMP tokens. Some developers referred to the event as the biggest ever fund loss in a smart contract incident.
After Compound Finance lost more than $70 million in tokens to a supply bug, Compound Labs founder Robert Leshner revealed in a recent tweet that millions more are at risk. According to Leshner, about $162 million is up for grabs after an upgrade malfunctioned on the DeFi staking protocol.
Last week, Compound Finance said that a supply bug mistakenly gave out more than $90 million worth of COMP tokens to users. At the time, the Compound Labs team stated that a bug caused the unfairly token distribution within its newly implemented Proposal 062. The primary function of the upgrade is to “split COMP rewards distribution and bug fixes.”
In a statement, Leshner noted the maximum number of COMP tokes that could be accidentally distributed. In a tweet, he said the worst impact of the bug would be at 280,000 comp tokens or about $92.6 million.
Compound Finance Remains at Risk Due to Token Distribution Bug
However, Leshner revealed in a more recent tweet that another 202,472.5 COMP tokens are exposed for exploitation. The amount of the exposed tokens is close to $66.9million. In total, the amount of COMP at risk is approximately 490,0000. According to Leshner’s tweet, 136,000 of the total COMP at risk is still in the Comptroller and 117,000 has been returned to the community. He continued:
“Going forward, I’m optimistic about the patches making their way through the governance process, which fix the distribution, and the community members that are working to manage this bug.”
Some developers are referring to the loss as the biggest ever in history. A developer at DeFi platform, Yearn, summed up the lost amount and noted it at $147 million. After then, he said the huge sum has officially made it the “largest fund loss in a smart contract incident.”
Another developer at decentralized crypto exchange Sushiswap, Mudit Gupta, commented on how the crypto market was not affected with the largest-ever fund loss. Unlike several events that trigger losses across several cryptocurrencies, the crypto market was unshaken with the event of the fund loss.
Gupta stated:
“The crypto market shrugged off the largest-ever fund loss as if it was nothing. The future for DeFi is bright but we’re in uncharted territory, and there’s a lot to be learned still.”
When Proposal 062 started malfunctioning, users began to receive huge COMP tokens worth millions. The loss could have been worse if the Comptroller contract did not have a limit.
Compound’s Governance Model Requires a 7-Day Window
Although a few proposals exist to fix the bug, the governance model requires a 7-day window to enable any changes. Till then, users who know to exploit the bug can access the pool of cash.
Also, the Compound Finance team assured that borrowed and supplied funds are not at risk.
At the time of writing, COMP is down nearly 80 percent to $315.45. On the other hand, the cryptocurrency has jumped over 22 percent in its 24-hour trading volume.
