Tapioca DAO lost $4.5M in a hack, causing TAP tokens to drop by 96%, triggering panic and heavy trading activity across markets.
The attacker stole 30M TAP tokens and millions in USDC and ETH, quickly converting and moving funds to the Binance Smart Chain.
Despite the breach, the team secured 1,000 ETH worth $2.7M planning to recover and rebuild while urging caution on misinformation.
Tapioca DAO disclosed losing $4.5 million in cryptocurrency as a result of a severe social engineering attack. The hacker gained control over the TAP token vesting contract and USDO stablecoin contract.
As a result, the attacker took advantage of these weaknesses and made large losses, including the loss of 30 million TAP tokens as well as millions of USDC and Ethereum. TAP's value thus fell from $1.50 to $0.046 in a single day.
https://twitter.com/tapioca_dao/status/1847330264139145361 Attack Details and Financial Impact
In addition to the large liquidation of TAP tokens, the hacker also depleted liquidity pools, resulting in a 96% loss in value for the TAP token. Trading volume spiked by 12,916%, with many investors reacting to the attack.
The attacker stole $2.8 million in USDC and $1.57 million in Ethereum, later converting them to USDT and moving funds to the Binance Smart Chain. Despite these actions, the DAO has initiated recovery efforts and moved swiftly to secure the remaining assets.
Recovery Efforts and Future Plans
However, the team, with the help of web3 security firm Fuzzland and SEAL911, managed to rescue 1,000 ETH worth $2.7 million from a vault, safeguarding part of the DAO’s collateral. This immediate intervention prevented further losses, crucial for the DAO's ongoing projects, including Big Bang Origins.
Additionally, the Tapioca Foundation has warned users not to interact with any contracts or tokens until an official post-mortem and recovery plan are shared.
Moreover, the DAO is actively coordinating in a "war room" with essential entities to resolve the issue. As of now, the foundation is focused on long-term recovery, with a portion of funds already secured.
While recovery efforts are ongoing, Tapioca DAO has urged its community to remain patient and cautious. Significantly, the team has advised users to avoid any misinformation and await further updates directly from the DAO's official channels.
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