Euler: an operation called "donation" opens a hole of nearly 200 million

On March 13, 2023, Euler Finance underwent an operation valued at approximately $197 million. This loan system must constantly check that the accounts have enough guarantees. The attack is aimed precisely at the way in which certain operations alter these balances.

A Donation to Reserves function can change the situation of an account without the expected credit check. By combining temporary borrowing and liquidation, the attacker gains an advantage that should not have existed. The seemingly generous name of an operation does not prevent a destructive effect in the protocol’s accounting.

Monitoring systems detect suspicious transactions and response teams review transactions. The vulnerable device is neutralized and Euler works with specialists to track assets. Public events make it possible to rebuild the financial chain without immediately knowing the person behind the address.

The following takes the form of a balance of power and discussions. A reward is offered, messages are exchanged, and then the restitutions begin. Their dollar value fluctuates as the assets return: you can’t compare two valuations as if they were notes that were sitting still in a safe.

Euler claims to have recovered the stolen funds after trading. The sources describe returns and statements from the exploiter, not the full and public judicial identification of all participants. Transfers to already known addresses do not alone prove belonging to a group.

This breakage has a rare feature: the race to exploit a fault is followed by a race to get the return of the main, without confusing this outcome with the absence of initial damage.