Flash Loaner Defrauded Makerdao Of $200M With Only $3 In Profit

(MENAFN- CoinXposure) According to arkham intelligence, users can borrow any amount of DAI without paying fees as per the contract. Following the loan, the bot provided the borrowed DAI to the Aave dai market and obtained $2,300 worth of wrapped ether (WETH) as collateral. This step leads to an intriguing turn of events.

Utilizing the obtained WETH, the bot promptly purchased Threshold Network (T) on Curve and sold it on Balancer. Remarkably, all these transactions occurred within a single block, facilitated by the flash loan, resulting in a profit of $33 before accounting for fees.

Nevertheless, the accumulated charges amounted to nearly $30, leaving only a meager net profit of $3.24. While this may appear insignificant, it is crucial to acknowledge that flash loans have been exploited maliciously in the past. Notably, there have been a series of flash loan abuses on decentralized finance (DeFi) platforms such as Platypus and 0VIX, resulting in losses surpassing $10 million.

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Despite the associated risks, the potential benefits of utilizing flash loans for arbitrage trading are substantial. Traders can swiftly capitalize on price disparities across various markets by borrowing substantial amounts of money without requiring upfront collateral. This implies that flash loans will continue to be a popular tool among individuals seeking to profit in the DeFi domain swiftly.

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