By
Chimamanda U. Martha
April 25th, 2024
While noting it had made efforts to secure the protocol, the Terraport team said it is still investigating the breach.
A decentralized finance (DeFi) exchange project based on the Terra Classic blockchain, Terraport Finance, has experienced a breach of its liquidity wallet. The hack took place on April 10 and resulted in a loss of about $2 million in digital assets.
Recall that the Terra-Luna crash about a year ago led to many projects within and outside the Terra ecosystem collapse. Terraport Finance was one of the few Terra-related projects which survived the collapse.
After completing a pre-sale within two months, TerraCVita launched Terraport on the Terra Classic blockchain. The goal was to rebuild the blockchain ecosystem by increasing the Luna Classic (LUNC) burn rate. To do this, Terraport Finance allows users to swap their Terra and UST tokens for LUNC and then burns them. Within seven days of its launch, Terraport burned about 100 million Luna Classic (LUNC) tokens.
While noting it had made efforts to secure the protocol, the Terraport team said it is still investigating the breach. “We are currently working with community members and major exchanges to secure as many of these funds as possible and blacklist wallets,” Terraport stated.
The team also appreciated the understanding of the large community and promised to release more information later.
Reactions Trailing the Terraport Finance Hack
Meanwhile, a myriad of reactions from crypto enthusiasts and project investors have trailed the successful breach of the Terraport Finance protocol. Several Twitter users have queried the rushed launch of the project, while some have claimed no audit was completed before the launch. Some users have also called out crypto influencers who used their platform to promote the project.
One crypto investor @2bitcrypto_YT noted that Terraport would need some hard work to get ahead of the hack. That hard work would necessitate showing it was a hack and not an oversight or issue that happened due to a bad contract. However, he expressed fear for investors in the project.
With reports suggesting that the stolen funds were moved to Binance, CEO CZ has refuted the claims. CZ said:
“Our team reviewed the transactions. Our analysis shows no funds were deposited in Binance.”
He then noted the funds were transferred to MEXC and KuCoin.
On their part, MEXC has noted it is working assiduously to freeze all illicit assets. Whatever the case, the project recovery will depend on how the team handles this case, as they will now have to battle depleted investor confidence and negative market sentiment.