Polter Finance, a decentralized platform for lending and borrowing, experienced a $12 million flash loan exploit, prompting an investigation and coordination with law enforcement.
On November 17, following the discovery of the breach, Polter Finance suspended operations and alerted its users on social media platform X. The stolen assets were traced back to wallets connected to the Binance exchange.
According to Web3 security firm TenArmor, the attack exploited a vulnerability related to oracle pricing in Polter Finance’s new SpookySwap (BOO) market, leading to significant losses. While Polter Finance has yet to verify the precise nature of the exploit, they reached out to the attacker via an on-chain message, proposing negotiations and a potential path to amnesty. However, as of the latest update, the hacker had not responded.
Polter Finance’s anonymous founder, known by the pseudonym “Whichghost,” filed an official report with the Singapore police, confirming their identity through Singpass, a digital ID service.
The police report outlined that over 16.1 million Singapore dollars (equivalent to $12 million USD) were stolen, including personal losses of $223,219 for the founder. The report highlighted that no private keys were shared and that the exploit stemmed from vulnerabilities in the smart contract associated with the BOO token lending.
Despite these efforts, skepticism emerged within the community, with some speculating that the hack could have been an insider job. Filing the police report was seen by some as a way to divert attention from internal investigations.
In a move to strengthen their efforts to recover the stolen funds, Polter Finance partnered with the Security Alliance Information Sharing and Analysis Center (SEAL-ISAC). The platform’s total market value prior to the attack included $7.87 million in Fantom (FTM), $1.03 million in wrapped USD Coin (USDC), $251,000 in Magic Internet Money (MIM), and $2.1 million in Stader sFTMX, among other assets.
