Hackers Steal $12M from Cork Protocol: The Great wstETH Heist!

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In a plot twist that would make even the most seasoned soap opera writer raise an eyebrow, hackers have decided to play Robin Hood—except they forgot the part about giving to the poor. Instead, they targeted a wrapped staked Ethereum contract, making off with a staggering $12 million worth of tokens. 🎭💰

Our dear friends at the decentralized finance platform, Cork Protocol, found themselves in a bit of a pickle. On the fateful day of May 28, the security firm SlowMist, which sounds suspiciously like a character from a fantasy novel, pointed out a potential smart contract vulnerability. This little hiccup involved a whopping 3,760 wrapped staked Ethereum (wstETH) tokens. Talk about a bad hair day! 🥴

“We are investigating a potential exploit and are pausing all contracts. We will report back with more information as soon as possible.”

— Cork Protocol (@Corkprotocol) May 28, 2025

In the aftermath, Cork Protocol confirmed that they had indeed experienced a “security incident.” This unfortunate event affected both the wrapped staked Ethereum tokens and the wrapped Ethereum tokens. Naturally, the protocol decided to hit the pause button on its smart contract, because who wouldn’t want to take a breather after losing millions? ⏸️

According to Cork Protocol, the rest of the markets on their platform were as untouched as a cat in a room full of rocking chairs. The team assured everyone that they were actively investigating the situation, which is code for “we’re frantically trying to figure out what just happened.” 🕵️‍♂️

What on Earth Happened with the Cork Protocol?

According to the blockchain security firm Cyvers, the dastardly attacker deployed a malicious contract with an address funded by 0x4771…762B. Cyvers claims this address likely belongs to a service provider, which could mean a DeFi protocol, exchange, or bridge that Cork Protocol was using. In other words, it’s like finding out your best friend is actually a secret agent. 🤔

Just 16 minutes after the malicious contract was executed, the attacker swiftly swapped the wstETH for Ethereum. And the stolen ETH? Well, it’s still lounging around in its original wallet, probably sipping a piña colada and enjoying the sun. 🍹

Cork Protocol allows users to hedge against the risk of token depegging, including wrapped stablecoins, liquid staking, and restaking tokens. The wstETH to weETH trading pair is one of the core markets the protocol securitizes. It’s like a safety net, but with more digital coins and fewer clowns. 🎪

All of these assets are forms of wrapped tokens, enabling users to perform DeFi operations that would make even the most adventurous of squirrels raise an eyebrow. However, this also exposes users to added risks, including counterparty risk, smart contract vulnerabilities, and potential exploits. In the event of a hack or rug pull, the wrapped version of a token can become worth less than its unwrapped counterpart, leaving users with significant losses. It’s like buying a fancy sandwich only to find out it’s just bread and air. 🥪

With Cork Protocol, users can buy depeg swaps to protect their assets if they fall below their peg. In addition to wstETH to weETH, the platform also offers securitization for wETH to wstETH, sUSDS to USDe, and sUSDe to USDT. Because why not throw in a few more acronyms for good measure? 🤷‍♂️

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2025-05-28 17:39