Recently, the platform had to call DAO’s emergency meeting due to the security issue identified in an Oracle of Lido Finance. This attack was detected when about 1.5 of a wallet associated with this Oracle Ethereum Stole, due to which the balance of this wallet was less than necessary. According to Lido Finance, the attacker managed to carry out the theft due to the compromise of Non-Public key connected to this wallet.
The impact of the attack is just on a wallet, the protocol is completely safe
Lido Finance reported that this issue has no effect on any other wallet or stacking associated with the platform and all other stacking is completely safe. The quorum of Lido Protocol works on the consent of 5 out of 9. Meaning that the remaining eight Oracle, even after an oracle is compromised, is capable of keeping the protocol secure. After this recent security breech incident, the remaining eight Oracle were checked which are completely secure. Also, a new wallet address has been added to the place of a wallet compromise. Voting process has also been started to operate this new wallet. Giving information about this entire incident, Lido Finance said that this issue has been handled and Lido Protocol is completely secure and operational.
What is Lido Finance
It is a dysented finance platform that gives the service of liquidity stacking for blockchains working on proof of stacking. This gives the user tokens of the same value in lieu of their stack liquidity. For example, if someone stacks Ethereum on Lido, LIDO will give him the same steth token of the same value. The highest stacking of Etreum is on Lido Finance, based on a locked value. Rewards are also given for stacking on Lido Platform.
Conclusion
This security issue on Lido Finance and the action taken on it shows the import of transparency and fast response in the Space. Although this attack was linked to only one wallet, timely reporting saved it from being bigger. Along with this, the protocol was not affected due to the strong governance and safety mechanism of the platform. Lido Dao, taking immediate action, not only added the new wallet, but also insisted that all other Oracle also continued to work properly and remained platform operational. This incident has proved that such an attack can be avoided if the risk management system of a protocol is strong.
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