Pickle In A Pickle

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Pickle Finance

Pickle suffered a complex attack, which can be expected when many different systems are working together and there's a very strong incentive to break in.

In this case, the Pickle Finance team has not made any efforts to make right on what happened, so affected users are out the entire value of their funds.

This is a global/international case not involving a specific country.

About Pickle Finance

"Pickle came on the scene Sept. 11 as one of many food-themed DeFi projects." "Pickle Finance is a yield aggregation service that rewards users who provide liquidity to its various pools of stablecoins with interest and token disbursements in ether, other stablecoins or its native digital asset PICKLE." "The project attempted to bring price stability to the four top stablecoins, DAI, USDC, USDT and sUSD, which are frequently knocked off their dollar peg." "Pickle Finance shifts investors’ money around different DeFi protocols to maximise returns, a little like a traditional robo-advisor. " "On 2020–11–21 06:37 PM (UTC), Pickle’s pDAI PickleJar was hacked and 19,759,355 DAI was drained."

"This was a very complicated attack and involved many components of the Pickle protocol." "Shortly after the security breach and loss of nearly $20 million in DAI, Pickle’s administrators engaged with cybersecurity specialists to tackle the situation." "After many hours, the team (now totalling more than 10 people) finally figured it out how it was executed."

"The attacker swapped funds between a malicious copycat contract and Pickle cDAI Jar (Pickle’s yield-bearing vault) thus leading to the loss of funds." "Pickle Finance focused on providing an automatic solution for moving funds between various DeFi protocols in order to maximize profits. Hence, they required depositing funds in Compound as a kind of “common ground” for trading and arbitration." "[T]he attacker created “bad jars,” —contracts with a similar interface to the “good jars” but programmed differently. The attacker then exchanged funds between his “bad jar” and the real cDAI Jar, taking the $20 million in deposits."

"At the moment the money stolen from the hacker is still in the dormant wallet and yet to be laundered to various exchanges. As expected following news of the hack, Pickle Finance native token (PICKLE) suffered a dip losing more than 50% of its value in a few hours." "Pickle Finance said in a Nov. 24 tweet that it has a “small chance” of recovering the stolen money." "Although this avenue has a small chance of recovering the lost funds, we will not be issuing any IOU tokens so as to not impede the growth of this protocol going forward."

This is a global/international case not involving a specific country.

The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.

Include:

• Known history of when and how the service was started.
• What problems does the company or service claim to solve?
• What marketing materials were used by the firm or business?
• Audits performed, and excerpts that may have been included.
• Business registration documents shown (fake or legitimate).
• How were people recruited to participate?
• Public warnings and announcements prior to the event.

Don't Include:

• Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
• Anything that wasn't reasonably knowable at the time of the event.

There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.

The Reality

This sections is included if a case involved deception or information that was unknown at the time. Examples include:

• When the service was actually started (if different than the "official story").
• Who actually ran a service and their own personal history.
• How the service was structured behind the scenes. (For example, there was no "trading bot".)
• Details of what audits reported and how vulnerabilities were missed during auditing.

What Happened

The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.

Key Event Timeline - Pickle In A Pickle

Date	Event	Description
November 21st, 2020	Main Event	Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.

Technical Details

This section includes specific detailed technical analysis of any security breaches which happened. What specific software vulnerabilities contributed to the problem and how were they exploited?

Total Amount Lost

The total amount lost has been estimated at $19,759,000 USD.

How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

Immediate Reactions

How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?

Ultimate Outcome

What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

Total Amount Recovered

There do not appear to have been any funds recovered in this case.

What funds were recovered? What funds were reimbursed for those affected users?

Ongoing Developments

What parts of this case are still remaining to be concluded?

General Prevention Policies

Decentralized smart contracts are effectively hot wallets. The right mistake in the coding can provide a hacker with access to any funds under the control of the contract.

One of the key advantages of centralized platforms is that withdrawals which are obviously suspicious can be prevented.

Individual Prevention Policies

No specific policies for individual prevention have yet been identified in this case.

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

Policies for platforms to take to prevent this situation have not yet been selected in this case.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

No specific regulatory policies have yet been identified in this case.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.