Early Christmas! Bug in Compound’s software distributes 162 million tokens to users
For someone in the DeFi world of decentralized finance, Santa has arrived early due to a nice programming bug. The Compound staking protocol has distributed 162 million in tokens, according to founder Robert Leshner, all following an unsuccessful software update.
As tweeted by Leshner, the planned distribution of tokens following the upgrade was excessive for a total which, in the end, was equal to 162 million dollars at the value of the token at that time.
Some, including a lead developer of the DeFi Yearn platform, are calling it the biggest loss of funds in a smart contract scheduling crash.
What went wrong? DeFi protocols such as Compound are designed to recreate traditional financial systems thanks to smart contracts, self-executing contracts on blockchains. A way to give more certainty and without human intervention. On Wednesday, Compound rolled out what should have been a pretty standard update. Immediately after the implementation, however, it was clear that something had gone seriously wrong, as users were getting millions in Comp tokens, with a single transaction moving 30 million.
The c "Comptroller" contract, which controls the whole system, fortunately had a limited amount of tokens, but, for some reason, this
"When the drip () function was activated this morning, it sent the backlog (202,472.5, about two months of COMP since the function was last called) in the protocol for distribution to users," he wrote Leshner in a tweet on Sunday morning.
Leshner noted that this brought the total comp at risk to 490,000 comp tokens, or about $ 162 million.
There are some proposals to fix the bug, but Compound's governance model is such that any protocol change requires a multi-day voting window so nothing could have been done to fix the bug. Another shortcoming of DeFi protocols is often the inability to act in an emergency and be approved ex post. The CEO had no choice but to ask community members to voluntarily return the tokens, threatening others to be reported to the IRS for the payment of taxes on their undeserved relative profit. It seems that 117 thousand tokens have returned voluntarily, a sign that therefore the community has shown a certain compactness.
Paradoxically, the token was not affected that much, with a drop of only 5% in a day that was not positive for almost everyone:
The funds however did not affect the funds managed by Compound, which remains safe, but only the proprietary Comp token.
Compound is the fifth largest DeFi protocol in the world with a total locked down value of $ 10.3 billion, according to DeFi Llama, which provides rankings and metrics for DeFi protocols. The problem is not so much in the loss of funds, which will ultimately only lead to a delay in the issuance of new tokens, as in the trust in the DeFi system.
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Christmas article early! Bug in Compound software distributes 162 million tokens to users comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/natale-in-anticipo-bug-nel-software-di-compound-distribuisce-162-milioni-in-token-agli-utenti/ on Mon, 04 Oct 2021 11:19:23 +0000.