Prisma Finance: Restarting Operations Safely
Prisma Finance recently experienced a hack resulting in a loss of $11.6 million, leading to a temporary halt in platform operations. The platform is now working on a strategy to cautiously resume activities post the security breach. Here are the key details you need to know:
Exploit Impact and Governance Response
- Prisma Finance fell victim to a hack on March 28, resulting in the theft of around $10 million in cryptocurrencies.
- The exploit was carried out through a flaw in the migration zap contract, causing a total loss of $11.6 million.
- Assets targeted in the hack included wrapped-staked Ethereum (wstETH), which were swiftly converted to Ethereum (ETH) for anonymity.
- The core functionality of Prisma Finance was unaffected, with the breach confined to the migration zap contract.
Governance Updates and Voting
- An emergency pause was initiated on all trove managers to halt borrowing activities post the hack.
- A four-day governance vote commenced to decide on resuming borrowing activities, ending on April 7.
- The community has shown strong support for the platform’s recovery efforts, with a unanimous vote in favor of resuming borrowing.
Strategy Moving Forward
- Frank Olson, a core contributor, presented a plan for safely restarting the Prisma protocol on April 3.
- The plan includes reinstating features like depositing liquid staking tokens (LSTs) and liquid restaking tokens (LRTs) for users.
- Enhanced security measures, including continuous auditing services and bug bounty programs, are prioritized for ongoing protection.
Key Measures for Recovery
- Proposed changes post-exploit include reducing protocol-owned liquidity (POL) and adjusting stakeholder distributions temporarily.
- The weekly POL amount will be decreased from $40,000 to $0, and the allocation to vePRISMA holders will be halved.
- These changes are considered necessary for the current situation and may be revisited based on future developments.
Hot Take: Moving Forward
As Prisma Finance works on resuming its operations post the recent hack, it’s crucial for users to stay informed about the platform’s recovery efforts. By implementing strategic measures and receiving strong community support, Prisma aims to navigate through this challenging time and reinforce its commitment to security and transparency.
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