Senator Cynthia Lummis (R-WY) has given a specific date for when her long-awaited crypto regulator bill will be unveiled. The legislation will help to sort cryptocurrencies under appropriate regulatory labels and federal jurisdictions. According to a tweet from the senator on Friday, the final version of her bill will be released on Tuesday, June 7th. Lummis has spent months working on the bill alongside Senator Kirsten Gillibrand (D-NY), announcing it as early December 2021. The bill will reportedly provide sweeping…
Leading Decentralized Finance (Defi) Protocol Compound is staring at heavy losses following a bug bite. The firm’s chief, Robert Leshner, has revealed it in a series of tweets. Also, Leshner blamed the firm’s woes on an upgrade that went wrong.
Compound has recently updated its Comptroller Contract. The Proposal 062 update manages how the protocol rewards its stakers. A bug in the upgrade has seen the contract wrongfully allocate its users staking rewards in COMP tokens.
The news won’t be pleasant for Compound Labs and its investors. Moreover, since it followed a similar exploit last week. In that instance, the protocol lost 280,000 COMP or $92.6 million.
Rewarding the White Hats
The firm has since recovered 117,000 COMP following an appeal by Leshner to Compound’s customers. The firm promised to give them a white hat fee of 10% of what they’d wrongfully benefited from. It also threatened to report those who failed to return the funds to the IRS.
In the recent development, the bug transferred 202, 472 COMP or $68 million from the reservoir to the Comptroller Contract. There the funds remain at risk.
Initial investigations reveal that contracts from the MakerDAO DSProxy factory. Leshner has said that MakerDAO is helping Compound resolve the issue. However, by the time of going to press, it hadn’t commented on its involvement.
A Battered COMP
Following the developments, Compound’s native governance token, COMP, has taken a beating. Friday’s news of the initial exploit saw it slump more than 10%. However, it had begun recovering only to face the second exploit on Sunday. Consequently, its value has slid further by more than 10%.
Banteg has suggested that many knew that it was possible to top up the bugged contract. Despite this knowledge, the community had chosen to keep mum on it. They’d hoped no one would notice for a week.
Unlike other protocols, Compound doesn’t have a multi-signature scheme for its contracts. As such, the protocol can upgrade them immediately. Instead, it can only institute changes after a week-long governance process. This requirement protects the protocol from hostile changes. At the moment, it’s hindering the repair of the buggy code.
A Heated Debate
Compound’s woes have drawn heated debate. Leshner holds that the DeFi community is split into two on this. On the one hand, there are the Defi builders. These, according to him, see erroneous tokens as belonging to the community. On the other, there are profit maximalists. They see problems like Compound is experiencing as their own doing.
A glimmer of hope from the whole debacle is that borrowed and supplied funds are safe. Leshner has assured users that their funds are secure. Defi Llama ranks Compound as the fifth largest DeFi protocol. It has a total value of locked funds of $10.3 billion.