An attacker inflated TONIC 100 times to pull $75 million out of Tectonic

On Sunday, Cronos halted its whole blockchain after an attacker drained ~$75 million from Tectonic, the network’s largest lending market.

The halt trapped all but about $6 million of the loot before it could leave the chain.

Only $6 million reached Ethereum before Cronos stopped producing blocks

The attack targeted the price of TONIC, the protocol’s thinly traded governance token, said on-chain researcher Weilin Li, who was the first to lay the sequence out on X.

The token was pumped about 100 times in 20 minutes and then collateralized to borrow other real assets out of the protocol, Li says.

Tectonic’s own parameters gave TONIC a 20% collateral factor, meaning a depositor could borrow up to a fifth of the value of the deposited token. Li counted about 364.6 trillion TONIC in the attack position.

The pile needed to be worth around $0.00000103 per token to support the borrowing on display, CoinGecko data shows, or about 100 times where TONIC was trading before the attack.

Tectonic’s documentation warned that low-liquidity assets are susceptible to exactly this kind of price manipulation.

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