Curve Finance (CRV) founder and CEO Michael Egorov commented on the recent UwU Lend hack, stating that Curve Finance was not the target of the crime. Egorov highlighted that “this was not a Curve exploit” in a Q&A. This was an abuse of a different project [UwU Lend], the statement went on. “[…] the hacker deposited CRVs taken from UwU to lend.curve.fi (LlamaLend) as part of a cash-out play and vanished with the funds, leaving his debt in the system.” In an effort to at least partially offset losses, Egorov emphasized safeguards against potential attacks and advised UwU Lend to “re-verify all contracts and connect them to good security auditors.”
According to the initial report, Egorov suggested burning 10% of the $37 million worth of CRV tokens in order to maintain the token’s price and provide voters a higher annual percentage payout. Egorov addressed the false statement of the team burning 10% of CRV tokens in the Q&A that followed. A phony (impersonator) account tweeted this information along with a scam link. Few journalists failed to verify the information before publishing it.
On June 15, Egorov declared that he had paid back all of the $10 million in bad debt that resulted from soft liquidations brought on by the UwU exploit. “CRVs listed as loan collateral made up almost 30% of the total supply; half of that was on Curve, indicating that some bad debt was indeed accrued. It was paid back already. Nobody is impacted.When Cointelegraph asked Egorov about Curve Finance’s strategy for handling liquidation risks in erratic markets, he replied as follows: “One should probably provide borrow caps for non-major crypto (i.e., collateral other than BTC or ETH); data suggests that Curve-specific markets can be well-parametrized to withstand even these conditions.” Speaking about onchain arbitrage, Egorov stated: It seems that powerful figures in the sector were not quite aware of how to handle liquidations. Speaking about onchain arbitrage, Egorov stated: Heavyweights in the industry don’t seem to have a complete understanding of liquidations, as seen by their failure to try partial hard liquidations for my position on Curve. I eventually had to handle it on my own.” In the future, Egorov proposed the development of “open-source liquidation bots” and community education regarding liquidations to handle the liquidation’s wider implications for decentralized finance.