Will crypto ever be safe? New hack and big problems for Cover Protocol investors
We already wrote about some of the biggest hacks in the industry. Unfortunately, the new DeFi protocols aren’t immune to hacks either.
On Monday 28th of December, a new hack have happened, essentially exploiting the system vulnerability, printing nearly infinite amount of COVER Protocol tokens and selling them for around 5 million dollars.
While there are news saying this was done by a white hat hacker called “Grape.Finance” and the money was returned to the system- the damage was already done.
On Monday morning, the price of COVER was $851, but on the same day after the hack it dropped to a miserable $17.41.
Needless to say, this hack have “killed” most investors that believed in COVER.
While DeFi projects are very interesting, and obviously very lucrative since their invention, things like this may push investors out.
This is why you should always diversify, especially in highly volatile markets, which the crypto market definitely is.
Possible new token and exchanges block
The team behind COVER thinks about using a snapshot taken before the hack, which should bring all balances back to normal, but based on the current price action, no action in this world can bring COVER back to its previous track.
The above is also backed up by the fact that major crypto exchanges are disabling COVER trading and deposits, leaving only withdraws as an option(like you’d like to withdraw a token that fallen 40x).
If you were the unfortunate owner of COVER there’s probably not much to do but wait. Hopefully, you didn’t invest a large portion of your capital into it. We’ll all anyway keep a look on how COVER stuff will try to handle this situation.