A new hack affects a DeFi project, causing the project’s currency to collapse.

As stated in Source The “COVER” decentralized finance project was hacked, which led to the collapse of the project’s digital currency, named after the project.

As the price of the digital currency “COVER” decreased by more than 95%, and the price of the coin fell from 845 dollars to less than 30 dollars, according to the website coinmarketcap.

The team behind the project has so far failed to provide any explanation for the crash and hack.

Members of the cryptocurrency community, including Twitter influencer Evan On Tech, have revealed that the protocol has been badly exploited.

Read:The number of individual investors in cryptocurrency decreased significantly in the first quarter of 2022 and institutions are taking the lead

According to another user, what happened is as follows:

Someone minted the fake cryptocurrency, provided liquidity through Balancer, and bet on BPT by mistake and exploiting a loophole in the “COVER” protocol.

The hacker managed to exploit this bug, which allows him to mint infinitely “COVER” cryptocurrencies.

The “COVER” project is not the only one that fell victim to such exploitative behavior as it was preceded by several badly exploited decentralized finance projects earlier.

Read:Why do many investors consider Ethereum to be the proxy for the alternative cryptocurrency market?

At the beginning of this month, Warp Finance was exploited by a quick loan attack and hackers managed to steal $7.7 million.

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