Aave Protocol Suffers Aftermath Of Attempted Hack By Mango Attacker
The return of Evi Eisenberg, the famous Mango attacker, is the most unfortunate story to have come out of the decentralized finance (DeFi) space this week. Meanwhile, Eisenberg hacked the Solana-based Mango Markets in October, pulling off a $100 million heist from the platform.
“The highly profitable trader,” as the attacker calls himself, launched an audacious hacking attempt this week targeting the $3.64 billion DeFi lending platform Aave.
Like the Mango hack, the attacker just operated within the restrictions of the firm’s code. As a result, there was no single hack, fraud, or tax gap incident.
However, the attacker failed the latest shot, which again brings up another discussion for on-chain crypto investigators to note. Below is how the event unfolded.
A Timeline Of Events
Since November 14, the hacker has amassed a combined 92 million CRV (Curves native token) worth $39 million on Aave while using $50 million worth of USDC stablecoin as collateral.
After that, he sent a hefty amount of the CRV coins to a centralized exchange (CEX), OKEx, to sell or keep. He then used the USDC tokens, which he swapped for the CRV, to borrow more of the Curve tokens, rinse, and repeat.
This shows that he built a massive short position using the Curve Governance asset. However, the question is, why did he choose to build a short CRV? There’s no straightforward answer to that question.
However, the first reason is that Eisenberg aims to liquidate the massive CRV loan of Curve founder Michael Egorov. Data from DeFi Llama shows that the founder has a whopping $48 million loan on Aave that would have been paid, but the price of CRV has slumped to under $0.29.
However, Egorov did come close to being liquidated, which he refused to do as he added another massive amount of collateral to avoid ruin.
The second premise is that Eisenberg was initially testing the boundaries of Aave. If Eisenberg takes out a large portion of the lender’s fund, Aave would still be left with close to $1.6 million in bad debt.
Meanwhile, as the Curve founder was not liquidated and Aave has survived the initial scare, does this imply that the attacker has lost? The answer might be yes, considering that Eisenberg is reported to have lost $10 million, depending on what the on-chain activities have shown.
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