Key facts
- Balance Coin, an algorithmic stablecoin, has fallen more than 99%.
- The stablecoin is currently trading at $0.0014.
- The depeg followed a $915,000 exploit of 42DAO, the governing body of the Balance Protocol.
- The attacker manipulated the protocol's bitcoin price oracle to trigger improper liquidations.
Balance Coin, an algorithmic stablecoin designed to maintain a $1 peg, has collapsed more than 99% to approximately $0.0014. The decline followed a suspected $915,000 exploit of 42DAO, the governance entity behind the Balance Protocol. Blockchain data indicates the attacker manipulated the protocol's bitcoin price oracle, triggering improper liquidations of collateralized vaults. This allowed the attacker to seize collateral and net about $912,000. The incident occurs amid broader concerns about DeFi security, particularly with the increasing capabilities of AI systems posing new risks.