Replace (April 26 at 8:57 PM UTC): This text has been up to date to incorporate updates from Loopscale.

Solana decentralized finance (DeFi) protocol Loopscale quickly halted its lending markets after struggling an roughly $5.8 million exploit. 

On April 26, a hacker siphoned roughly 5.7 million USDC (USDC) and 1200 Solana (SOL) from the lending protocol after taking out a “series of undercollateralized loans”, Loopscale co-founder Mary Gooneratne stated in an X put up. 

Loopscale has since “re-enabled loan repayments, top-ups, and loop closing”, however “[a]ll other app functions (including Vault withdrawals) are still temporarily restricted while we investigate and ensure mitigation of this exploit,” Loopscale stated in an April 26 X put up.

The exploit solely impacted Loopscale’s USDC and SOL vaults and the losses signify round 12% of Loopscale’s complete worth locked (TVL), Gooneratne added. 

“Our team is fully mobilized to investigate, recover funds, and ensure users are protected,” Gooneratne stated.

Within the first quarter of 2025, hackers stole greater than $1.6 billion price of crypto from exchanges and on-chain good contracts, blockchain safety agency PeckShield stated in an April report. 

Greater than 90% of these losses are attributable to a $1.5 billion assault on ByBit, a centralized cryptocurrency trade, by North Korean hacking outfit Lazarus Group.

Associated: Crypto hacks prime $1.6B in Q1 2025 — PeckShield

Distinctive DeFi lending mannequin

Launched on April 10 after a six-month closed beta, Loopscale is a DeFi lending protocol designed to boost capital effectivity by immediately matching lenders and debtors.

It additionally helps specialised lending markets, resembling “structured credit, receivables financing, and undercollateralized lending,” Loopscale stated in an April announcement shared with Cointelegraph. 

Loopscale’s order e-book mannequin distinguishes it from DeFi lending friends resembling Aave that combination cryptocurrency deposits into liquidity swimming pools.

Loopscale’s predominant USDC and SOL vaults yield APRs exceeding 5% and 10%, respectively. It additionally helps lending markets for tokens resembling JitoSOL and BONK (BONK) and looping methods for upwards of 40 completely different token pairs. 

The DeFi protocol has roughly $40 million in TVL and has attracted upwards of seven,000 lenders, in accordance to researcher OurNetwork.

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