Tokenized Google stock exploit inflates collateral 78x, creating $403K bad debt

Edel Finance has halted its version-one lending protocol after an attacker exploited a vulnerability in the wrapping mechanism for tokenized Google stock, leading to a significant inflation of collateral values and approximately $403,000 in bad debt. The exploit involved manipulating the exchange rate between GOOGLx, a tokenized version of Alphabet's Google stock, and its wrapped form, wGOOGLx. This allowed the attacker to borrow real assets against collateral that was valued at roughly 78 times its actual worth. Edel Finance stated that the exploit did not stem from faulty price oracles, as Chainlink feeds accurately reported Alphabet's share price. Instead, the flaw lay in the conversion process between GOOGLx and wGOOGLx. The team has detected and contained the exploit, paused all version-one contracts, and is coordinating with exchanges. Edel Finance will absorb all losses to ensure depositors are made whole and is deploying a redesigned version-two system to prevent similar attacks. The team has also offered the attacker a white-hat settlement.