Whether the fixing of a pricing error by Mirror Protocol, the decentralized finance (DeFi) application built on Terra Classic, will help prevent a drainage of the pool similar to last year will only be known by the end of U.S. trading hours on Tuesday.

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Fast facts

  • The Mirror Protocol DeFi platform allows users to create and trade assets that mirror the price of stocks or major cryptocurrencies.
  • Twitter user @FatManTerra wrote on Tuesday afternoon that the Protocol disabled mBTC, mETH, mGLXY and mDOT as collateral and thus prevented the attacker from draining other liquidity pools.
  • A pseudonymous Mirror forum user named “Mirroruser” alleged last weekend that the exploit on the DeFi platform drained more than US$2 million.
  • Terra Classic validators were reporting the price of the new Terra 2.0 token as US$9.80, instead of the Terra Classic (LUNC) token that was priced near zero, ​​Twitter user @ChainLinkGod explained.
  • This was because a majority of the Terra Classic and LUNC validators are running an outdated version of the pricing mechanism, Todd Garrison, founder of blockchain developer Block Pane, explained on Twitter
  • The exploit was spotted in liquidity pools mirroring Bitcoin, Ethereum, Polkadot and Galaxy Digital stock within Mirror Protocol, Twitter user @FatManTerra said. 
  • @FatManTerra first discovered the previous drainage in Mirror Protocol worth US$90 million that took place last year. 
  • Terra launched its new blockchain over the weekend taking over the name Terra (LUNA), while renaming the old chain and token Terra Classic and LUNA Classic (LUNC).

See related article: Terra 2.0 new LUNA is down 70% since restart