$8.5M Term Finance Hack Exposes a Weak Point in DeFi Governance

TLDR

• Term Finance lost an estimated $8.5 million after an attacker exploited governance control over its strategy vaults.
• The attacker reportedly drained 2,843 ETH and about $1.68 million in stablecoins from the affected vaults.
• The losses represented roughly 68% of the $12.45 million held in Term Finance’s vault product before the attack.
• The attacker allegedly gained majority governance control and used malicious proposals to authorize vault withdrawals.
• Term Labs permanently closed new Meta Vault deposits and revoked DAO governance roles after confirming the exploit.

Decentralized lending protocol Term Finance suffered an $8.5 million loss after an attacker gained control of governance tied to its strategy vaults. The Term Finance hack affected the Meta Vault product, while the company said its borrowing and lending markets remained operational.

Security firms PeckShield and CertiK tracked the attacker’s holdings. PeckShield reported 2,843 Ether worth $6.87 million and 1.68 million USDC. The attacker exchanged the USDC for 1.68 million DAI.

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