Terra’s Mirror Protocol compromised again but “LUNA 2” soars 100% anyway

YEREVAN (CoinChapter.com) – Mirror Protocol, a DeFi application built on Terra, allegedly suffered another attack. According to reports, the latest exploit has cost the network over $2 million, but that number is likely to increase. 

Meanwhile, Terra’s new token, LUNA 2, soared 100% in the last 24 hours.

The latest attack comes days after Terra discovered hackers had siphoned off almost $90 million from the network in October 2021. Surprisingly, the exploit went unnoticed for seven months. 

A user under the pseudonym “Mirroruser” raised the red flag three days ago. Earlier today, “@FatManTerra” provided further details on the exploit. 

According to him, a bug in the pricing oracle had artificially increased the price of LUNC for the system by mismatching the old LUNC token with the new LUNA token. As a result, the attacker could use his limited LUNC holdings as collateral to withdraw large amounts of assets.

“Please look into fixing the LUNC price oracle, because in a short while, all liquidity pools will be drained, Mirror will accrue irremediable bad debt, and the system will collapse in on itself. This is not the time to be negligent,”

he appealed the founders following the Mirror Protocol hack.

Recommended: How to trade LUNA 2.0 after Terra’s $45B debacle

Tera’s new token, ‘LUNA 2’, soars 100%

The recent crash of LUNA saw the blockchain’s stablecoin Terra USD (UST) lose its peg to the US Dollar. As reported earlier by CoinChapter, Do Kwon, Terra’s founder, proposed the creation of a new chain under the same name. The old chain, as a result, would be named Terra Classic (LUNC). 

After the Terra community voted to support the proposal, Terraform Labs, the company behind the Terra blockchain, launched the new chain. Those that held LUNA tokens before it crashed were also promised an airdrop of the new token.

Major crypto exchanges, including Kraken, Gate.io, KuCoin, FTX, Huobi, MEXC Global, OKX, ByBit, Bitfinex, and, Binance, also agreed to list Terra’s new token LUNA 2.  

The new LUNA token soared following its launch, reaching an all-time high of $19.54 on May 28 before tanking again to $4.37. However, in the last 24 hours, the token has been rallying again. 

According to data provided by CoinMarketCap, between May 30-31, the price of LUNA is up almost 100%. After hitting a daily low of $6.38, the new token reached $11.97 before facing a correction. At the time of writing, LUNA exchanges hands for $9.73. 

According to reports, Luna is also working on building a new stablecoin for the recently-launched blockchain. Meanwhile, FatManTerra announced that the Mirror protocol had brought the situation back under its control, thus stopping the exploit.