According to Odaily, Chaos Labs founder Omer reported on the X platform that the PAXG/USDC market on Morpho experienced a loss of approximately $230,000 due to an oracle configuration error. Specifically, the Oracle SCALE_FACTOR on Morpho was incorrectly configured, failing to account for the difference between USDC (6 decimal places) and PAXG (18 decimal places). This discrepancy led to a 12-digit inflation in the PAXG price, allowing an attacker to deposit $350 worth of PAXG and borrow $230,000 worth of USDC.