Chainlink causes $11.2m loss to Venus protocol- Decoding the aftermath

Chainlink, regardless of not being a conventional cryptocurrency, has a major variety of buyers holding over $3 billion in market cap. All due to the use instances it presents to DeFi protocols throughout many chains.

Chainlink after the crash

Within the final 24 hours, LINK recovered by virtually 10% after falling by 34.64% to $5.2 at one level. Now buying and selling at $6.9, it seems to be that certainly one of Chainlink’s greatest merchandise was the downfall of one other protocol.

Chainlink’s value feeds are relied upon by lots of of Dapps and protocols. In truth, Chainlink’s proficiency on this area is such that the whole variety of initiatives in its ecosystem exceeded the 1,000 mark within the final yr alone.

Nevertheless, lately when TerraUSD and LUNA crashed, Chainlink suspended the worth updates. At present buying and selling at $0.15 and $0.04, the property affected not simply buyers but additionally protocols and platforms within the DeFi area.

Thus, as each the property misplaced all worth and utility, Chainlink halted updating the worth within the value feeds.

In consequence, Venus Protocol misplaced over $11.2 million. In keeping with the Venus workforce, on account of an abrupt halt in LUNA value updation from Chainlink, whose value feeds Venus relied on, the final value of LUNA on the protocol was famous as $0.107 when actually, the worth had already dropped to $0.01.

Consequently, hackers, upon discovering this exploit, managed to deposit 230 million LUNA and, in return, borrowed about $13.5 million. Following the assault, Venus introduced the suspension of the protocol itself.

Nevertheless, Chainlink holders appear unbothered by the occasions which have unfolded over the previous couple of days. Quite the opposite, 13 Might was the primary day after virtually a month that they had been on the peak of their activeness.

As LINK rallied to commerce at $7.1, over 5.8k buyers, the best look since January, performed 8.26k transactions, essentially the most since October 2021. Thus, managed to register transaction quantity exceeding $313 million.

This might’ve been an try and ebook earnings amid a falling market or an exit technique to stop additional downfall since, at the moment, 81.29% of all LINK holders are in losses.