$3.5 million exploit hits DeFi platform Arcadia on Base

Arcadia Finance has suffered an exploit, with its losses reaching approximately $3.5 million as of Tuesday, according to the blockchain security firm Certik.

Certik initially flagged the exploit early Tuesday, posting to X: "We have detected multiple suspicious transactions on Base ... The exploiter took ~$1.6 million from Arcadia Finance, likely through arbitrary 'swapdata' on its rebalancer contract."

A few hours later, Certik then noted that the "attack" had persisted with total losses reaching roughly $3.5 million.

Arcadia's team addressed the exploit with a post of its own to X, saying, "The team is aware of unauthorized transactions via a Rebalancer. Remove all permissions for asset managers." The company also advised users on its website to "disconnect rebalancers and compounders" from their accounts.

Backed by Coinbase Ventures, Arcadia is a platform and margin protocol that "allows users to lend, borrow, and trade assets permissionlessly."

Certik is one of the highest-profile web3 security firms working in the digital assets sector. Last month, Certik said crypto users and decentralized finance (DeFi) protocols lost $302 million to hacks and scammers in May, which was a 16.9% decrease when compared to the previous month.

Backed by firms like Sequoia Capital, Tiger Global and Goldman Sachs, Certik was valued at $2 billion as of last year.