The recent 7% rally to $0.61 of Curve Finance’s native token, CRV, has been linked to the return of stolen millions by a hacker who raided several decentralized finance (DeFi) protocols. The hacker, responsible for draining more than $50 million from Curve Finance, Metronome, and Alchemix on Sunday, has sent back $8.9 million to Alchemix, according to data from Etherscan. Despite the lack of funds returned to Curve Finance, this gesture has created an atmosphere of anticipation that a refund to the DeFi will occur soon.
Traditionally seen as a DeFi stronghold, Curve Finance’s reputation was undermined upon the discovery of a vulnerability in the Vyper programming language, leading to the massive heist. This revelation held a mirror up to the frailty of decentralised investor fund security, causing a rapid ousting of crypto capital from the platform, with the total value locked (TVL) dropping from $3.7 billion to $2.7 billion.
This wave of skepticism concerning Curve Finance’s security could negatively impact the protocol’s future TVL growth, posing as a significant obstacle for the value of CRV. Moreover, the unresolved issue of the alleged hacker’s intentions could potentially influence Curve’s long-term trajectory. In an attempt to seek restitution, Curve Finance enticed the offender with a 10% cut and no subsequent legal action, should the funds be reinstated by August 6th.
From another perspective, the return of these funds could provide temporary relief for CRV by mitigating risks of a market crash caused by one of CRV’s largest players, Michael Egorov, founder of Curve Finance. With a speculated borrowing amount of $80 million against his CRV holdings across various DeFi lending protocols such as Aave, concerns of the impact of his possible liquidation are trending among traders. The effects on Aave and the stability of CRV, should this situation become reality, remains questionable.
For the cryptocurrency CRV, the aftermath of the theft has presented an ongoing game of chances. Amidst warnings of long-term technical selling pressure and the lingering downtrend, the ideal scenario, which remains uncertain, is for the hacker to return all stolen funds allowing CRV to regain its pre-attack levels around $0.74.
Considering these recent events, for high-stakes players deliberating over near-term investment strategies, crypto presales could be a worthwhile venture. Superb potential up-starts with revolutionary ideas face promising pre-investment prospects. With a very modest price during the presale stage, the trajectory of these tokens can yield enormous exponential gains. However, it always pays to remember that crypto, with its rewarding potential, is also a high-risk asset class.
Source: Cryptonews
