Arkadiko Oracle Glitch Aftermath

What happened ?

Yesterday, 14th of December at roughly 9.30 pm UTC, prices of Coinbase and Coinmarketcap briefly became incredibly inflated on many assets.

The response

Arkadiko developers were alerted quickly thanks to a watchful community. Once we noticed the excess USDA supply, we immediately disabled Arkadiko Swap through a privileged function that only the DAO-contract can call.

Damage assessment

Now that the dust has settled, we calculated the effect of the malicious swaps that happened as a consequence of the minting glitch.

Conclusion

Due to an external error on coinmarketcap, our oracle experienced a glitch which resulted in a very brief window that enabled malicious users to take advantage of it. Two wallets were able to extract some STX from the pool, decreasing USDA price for everyone else. USDA is structurally healthy right now and the lowered price of USDA will most likely be closed by arbitrage in the future. Thanks to a vigilant community and quick dev response, Arkadiko was able to mitigate the damage done.

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Arkadiko Protocol

Arkadiko Protocol

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Arkadiko Protocol is a stablecoin (USDA) built on Stacks to bring DeFi to Bitcoin.