Meerkat Finance Exploit Was A Test, Funds Will Be Returned

The Meerkat Finance exploit was now likely a test and the funds will be returned as one developer noted, saying that DeFi is flourished by human greed so let’s read more in our latest altcoin news today.

The Meerkat Finance developer dubbed “jamboo” posted a message in a Telegram Channel named “Meerkatrefunds” and he said that their exploit was only a trial of testing the users’ greed and subjectivity and that the team was preparing to refund all of the victims. Jamboo provided proof by sending a small transaction from the deployer and showing that they have access to the exploited contract. The transaction was processed on the Binance Smart Chain network about 20 minutes from the Telegram post.

Meerkat was a yield vault project that forked Yearn. Finance’s code is one of the many forks of ETH-native protocols that populate BSC and the attack happened on March 4, a day after the platform launched which resulted in a loss of 73,000 BNB and $14 million of BUSD, hitting a total loss of $31 million in user funds. The members of the community were quick to label the exploit as a rug pull given that the Meerkat deplorer contract was updated to allow vaults to be drained right before the attack.

Some thought that the exploit will be a test of the Binance Smart Chain claim to decentralization as BSC is run by a network of 21 validator nods with many of them associated with or run by Binance. The exploit put the attackers in a difficult position as Binance controls on-offramps to BSC which means the stolen funds were locked on-chain and were impossible to realize as profits. The attention turned to the Meerkat Developers and their motivations with Jamboo’s message containing a few vague references to what instigated the team to steal more than $31 million from the users. Jamboo explained that the team eventually invited a third party to attack the vulnerability of the proxy contract that a full report will be upcoming. According to him, the theft was only made to show the avarice that pervades Defi:

 “DeFi is essential, but it has a lot of flaws. It is flourished by human greed.”