According to Cointelegraph, security firm Blockaid has confirmed a significant incident involving the lending platform More Markets. On Wednesday, an unidentified attacker successfully executed overborrowing tactics by utilizing specific assets within the ecosystem.
The attack vector relied heavily on liquid staking tokens provided by Ankr and a feature known as E-mode to facilitate excessive borrowing against collateral in WFLOW. Through this method, the adversary drained approximately 9.3 million worth of WFLOW from More Markets’ lending reserve. This event marks another instance where external protocols are leveraged to compromise DeFi security.
The loss was realized directly within the reserves managed by Blockaid on behalf of the platform. The incident highlights ongoing vulnerabilities in cross-chain interactions and the risks associated with overleveraging mechanisms enabled by liquid staking derivatives. Such exploits underscore the necessity for robust validation protocols when integrating third-party tokens into lending strategies.
The attack demonstrated how sophisticated actors can manipulate token balances to siphon funds without triggering standard circuit breakers initially designed to prevent overdrafts under normal conditions. The use of E-mode allowed bypassing certain constraints typically enforced on collateral ratios, enabling the attacker to liquidate the reserve before safeguards could react effectively.
This incident serves as a cautionary tale for participants in decentralized finance ecosystems who rely on Ankr tokens or similar derivatives for staking yields. More Markets and Blockaid are now reviewing their security frameworks following this drain of WFLOW assets, aiming to prevent recurrence through enhanced monitoring and stricter borrowing limits involving liquid staking instruments.
