This week, the Defi ecosystem of cryptocurrency was in the headlines for all the wrong reasons due to the first two decentralized finance platforms exploit. As a result, MakerDAO, the most popular one, has gone into protective mode.
Crypto Fud Comes Again
As general, the media had run with doubt spreading headlines about DeFi fear and crypto hacking to increase their page views. Nothing was hacked, and no reason existed for doubt and fear. A sly trader utilized the system’s vulnerability to perform an arbitrage attack and flash loan to benefit from markets with low liquidity.
Some industry specialists have proposed that this could prove beneficial for Ethereum as it indicted what could occur in the financial landscape that was newly established. MakerDAO, the biggest DeFi project across the globe, became the victim of itself as the organization was put on high alert.
MakerDAO Goes On Defensive Mode
Currently, according to defipulse.com, MakerDAO dominated DeFi markets with 57.5% market share.
Attention has been building due to the likelihood of a serious actor managing a vast quantity of the MKR token, which might risk the safety of the network and pull off a similar flash loan exploits.
At present, the big MKR cryptocurrency pots were managed by public-based VC firms that had a fixed interest in the projects’ successes, rather than its failure.
@richatmakerdao, MakerDAO’s community development head, had been publishing upgrades from a fresh Governance and Risk meeting, including Governance Security Module (GSM) of the platform.
Today’s Governance call should be lively… a lot to discuss! Join and learn about the GSM delay & Dark Fix details. https://t.co/yWifpfIgov
— Maker (@MakerDAO) February 20, 2020
Soon, the GSM was set at zero hours which, if settled, would allow a bad actor to dishonour the governance or would facilitate real-time penetration within the system. As stated by MakerDAO Forum, earlier attempts to push the module failed due to lack of awareness and insufficient knowledge.
Today’s meeting would raise a proposal to increase the module to a 24-hour delay offering the whole day to MKR holders to respond to any results from spurious governance.