Illicit flows on Ethereum hit yearly high last week

Quick Take

  • The spike coincided with a Curve Finance exploit that saw $73 million drained from the leading DeFi protocol.

Ethereum, the leading blockchain proof-of-stake blockchain, recorded its worst stretch of the year in terms of illicit flows last week.

Data tracked by Chainalysis shows that known illicit flows as a percentage of total flows on Ethereum reached nearly 2% for a period of several days last week. Between July 30 and August 5, the metric ranged between 1.7% and 1.82%, before returning to normal levels on August 6.

The highest recording prior to last week came in January, when illicit flows hit 1.46% of total flows on the network.

Spike coincides with Curve exploit

It is not clear exactly what prompted the spike, but it coincides with a high profile exploit of Curve Finance, the decentralized exchange — which shook DeFi last week.

Over $73 million was drained from Curve’s pools on July 30, after an attacker targeted vulnerable versions of the Vyper programming language to carry out so-called “reentrancy attacks.” As of August 6, $52.3 million had been recovered, according to security analysts PeckShield.  

Curve is currently offering a $1.85 million bounty to anyone who can provide information on the exploiter that leads to a criminal conviction.

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