Unfortunately, the chances of stablecoins are not going well lately. While the recent collapse of Terra’s algorithmic stablecoin UST reflected quite badly on the markets, there was also bad news on Solana’s side. So much so that the Solana-based DeFi protocol Nirvana was attacked by flash loan, which reflected quite badly on the native stablecoin.
Nirvana Finance Crashed After Flash Loan Attack
The Nirvana protocol on the Solana Blockchain network has been encountering some problems for a while. Finally, as Blockchain security company PeckShield announced, the project was attacked by Flash Loan. The NIRV stablecoin, which lost 98 percent of its value after the attack, also dropped the project’s other native token, ANA.
Examining the on-chain data shows that the attacker used a $10 million flash loan in USDC to mint $10 million worth of ANA tokens. Flash loans allow you to borrow large amounts of capital at low cost as long as the loan is repaid in the same block. This flash loan was secured by the Solend Protocol. The attacker subsequently exchanged the ANA tokens he received while manipulating the protocol’s Oracle system for $12.49 million in USDT.
This attack resulted in the removal of $3.49 million from the Nirvana treasury. Nirvana, on the other hand, has not yet made an official statement about the abuse.
