$1 380 000 USD

NOVEMBER 2021

GLOBAL

OLYMPUS DAO

DESCRIPTION OF EVENTS

"The Decentralized Reserve Currency. Olympus is building a community-owned decentralized financial infrastructure to bring more stability and transparency for the world."

 

"Olympus is a decentralized reserve currency protocol based on the OHM token. Each OHM token is backed by a basket of assets (e.g. DAI, FRAX) in the Olympus treasury, giving it an intrinsic value that it cannot fall below. Olympus also introduces unique economic and game-theoretic dynamics into the market through staking and bonding."

 

"OlympusDAO is an experimental project in the cryptosphere. The DAO manages a token treasury that's used to back the OHM currency. The purpose of the treasury is to make sure the token maintains a certain floor price. If the token drops below that price, the assets in the treasury can be sold to buy back OHM tokens — with the goal to bring its price back above that mark."

 

"The DAO uses a process for helping the token to stay above that mark called Bonding. The DAO buys assets from investors (to go into the treasury) and issues OHM tokens to replace them. These bonds usually get a 5-10% discount and the tokens are handing out after a vesting period, which is currently set to five days."

 

"Olympus DAO mistakenly believed they had shut down the OHM/DAI bond but didn’t actually do so. This mistake enabled someone to spend $50,000 to receive $1.43 million of Olympus (OHM) tokens when they should have received far less."

 

"Earlier today someone bonded an OHM/DAI bond that was presumed to be closed off. This enabled the user to have a substantial discount resulting in the user receiving 1697 ohm instead of 59 ohm. After this occurred, we took immediate action and the bond contract has been shut down in the meantime," wrote an admin named Wartull.

 

"Somebody used [the SushiSwap OHM/DAI pool] bond to sell $50,000 of OHM/DAI LP tokens for 1,697 OHM, worth $1.43 million. Instead, they should have received only around $52,000 to $55,000 of OHM. The OHM tokens they received will be distributed over five days."

 

"According to the update, there was a safety limit in place that stopped the user from being able to withdraw even more tokens. The OlympusDAO community is scheduled to host a community call on Thursday to discuss the incident."

Olympus DAO runs a protocol with a treasury backing the assets, aiming to maintain a minimum price floor. One of their bonds backing a liquidity pool was accidentally left online when not intended, resulting in an attacker being able to exploit that at a significant profit. It's unclear if any losses were covered by the project.

Sources And Further Reading

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