Yet again, Cream Finance skimmed by crooks: $130m in crypto assets stolen

Third time's the unlucky charm for loan outfit

Decentralized finance biz Cream Finance became further decentralized on Wednesday with the theft of $130m worth of crypto assets from its Ethereum lending protocol.

Cream ( and not reported the loss via Twitter, the third such incident for the loan platform this year.

"Our Ethereum C.R.E.A.M. v1 lending markets were exploited and liquidity was removed on October 27, 1354 UTC," the Taiwan-based biz said. "The attacker removed a total of ~$130m USD worth of tokens from these markets, using this address. No other markets were impacted."

Rendered as an acronym, C.R.E.A.M. stands for Crypto Rules Everything Around Me, and as noted the last time this occurred – when $18.8m in tokens were stolen a mere two months ago – that's a claim that's difficult to reconcile with the repeated looting of company coffers.

Lest we forget, the upstart, which currently has a market capitalization of about $66m based on the number of CREAM tokens in circulation, reportedly lost $37m in February.

DeFu - Decentralized f**kup

Decentralized Finance, or DeFi, is a way to conduct financial transactions without a central governing authority through the automated interaction of smart contracts – code that may or may not have bugs, but probably does.

PeckShield, a blockchain security company founded by Jiang Xuxian, former chief scientist of Qihoo 360, attributed the incident to a bug that the unidentified attacker was able to exploit.

"The hack is made possible due to a price manipulation bug in CREAM price oracle," said PeckShield via Twitter, referring to the mechanism used to look up asset price information in a decentralized system. "And this bug allows a directly transferred yDAI+yUSDC+yUSDT+yTUSD tokens to significantly increase yUSD pricePerShare, which allows for basically borrowing all funds in current lending pools."

The yUSD vault, based on the Yearn protocol, is a fund that consists of crypto coins tied to fiat currencies (e.g. Tether (USDT), USD Coin (USDC)) that accrues value from other transactions like interest, swap fees, and demand for tokens on which it's based.

The bug, according to Mudit Gupta, another blockchain security researcher, involves asset values that change too quickly for Cream to react.

A cunning plan

Gupta contends what happened was market manipulation, not oracle price manipulation.

"In price manipulation, you trick protocol into thinking something is worth more than it actually is," he said via Twitter. "Here, that didn't happen. The protocol was not tricked into an incorrect price. It always had correct pricing info."

Gupta, published a blog post analyzing the attack, which he described as particularly sophisticated and well executed.

"The summary of the attack is that the attacker borrowed $1.5bn of Yearn’s yUSD vault shares against $2bn worth of collateral," he explained. "They then doubled the value of the shares atomically by donating yUSD to the yearn vault. This meant that their debt on Cream became $3bn against a $2bn collateral. They can now default and take home a sweet $1bn profit. Cream only had $130m assets available for lending, so the attacker was limited to $130m profits."

Cream says the situation is now under control.

"With the help of friends from @iearnfinance and others in the community, we were able to identify the vulnerabilities and patch them," the firm said via Twitter. "In the meantime, we've paused our v1 lending markets on Ethereum and we're in the process of putting together a post-mortem review."

"We apologize to our users and community for this unfortunate incident and thank you for your support." ®

Similar topics

Other stories you might like

  • India reveals home-grown server that won't worry the leading edge

    And a National Blockchain Strategy that calls for gov to host BaaS

    India's government has revealed a home-grown server design that is unlikely to threaten the pacesetters of high tech, but (it hopes) will attract domestic buyers and manufacturers and help to kickstart the nation's hardware industry.

    The "Rudra" design is a two-socket server that can run Intel's Cascade Lake Xeons. The machines are offered in 1U or 2U form factors, each at half-width. A pair of GPUs can be equipped, as can DDR4 RAM.

    Cascade Lake emerged in 2019 and has since been superseded by the Ice Lake architecture launched in April 2021. Indian authorities know Rudra is off the pace, and said a new design capable of supporting four GPUs is already in the works with a reveal planned for June 2022.

    Continue reading
  • Prisons transcribe private phone calls with inmates using speech-to-text AI

    Plus: A drug designed by machine learning algorithms to treat liver disease reaches human clinical trials and more

    In brief Prisons around the US are installing AI speech-to-text models to automatically transcribe conversations with inmates during their phone calls.

    A series of contracts and emails from eight different states revealed how Verus, an AI application developed by LEO Technologies and based on a speech-to-text system offered by Amazon, was used to eavesdrop on prisoners’ phone calls.

    In a sales pitch, LEO’s CEO James Sexton told officials working for a jail in Cook County, Illinois, that one of its customers in Calhoun County, Alabama, uses the software to protect prisons from getting sued, according to an investigation by the Thomson Reuters Foundation.

    Continue reading
  • Battlefield 2042: Please don't be the death knell of the franchise, please don't be the death knell of the franchise

    Another terrible launch, but DICE is already working on improvements

    The RPG Greetings, traveller, and welcome back to The Register Plays Games, our monthly gaming column. Since the last edition on New World, we hit level cap and the "endgame". Around this time, item duping exploits became rife and every attempt Amazon Games made to fix it just broke something else. The post-level 60 "watermark" system for gear drops is also infuriating and tedious, but not something we were able to address in the column. So bear these things in mind if you were ever tempted. On that note, it's time to look at another newly released shit show – Battlefield 2042.

    I wanted to love Battlefield 2042, I really did. After the bum note of the first-person shooter (FPS) franchise's return to Second World War theatres with Battlefield V (2018), I stupidly assumed the next entry from EA-owned Swedish developer DICE would be a return to form. I was wrong.

    The multiplayer military FPS market is dominated by two forces: Activision's Call of Duty (COD) series and EA's Battlefield. Fans of each franchise are loyal to the point of zealotry with little crossover between player bases. Here's where I stand: COD jumped the shark with Modern Warfare 2 in 2009. It's flip-flopped from WW2 to present-day combat and back again, tried sci-fi, and even the Battle Royale trend with the free-to-play Call of Duty: Warzone (2020), which has been thoroughly ruined by hackers and developer inaction.

    Continue reading

Biting the hand that feeds IT © 1998–2021