Radiant Capital Begins Repayment After $4.5 Million Exploit

Radiant Capital, a prominent player in the cryptocurrency lending space, has taken significant steps to address the fallout from a recent security breach. The exploit, which occurred on January 2nd, saw the Radiant Capital's USD Coin (USDC) pool on the Arbitrum network compromised, resulting in a loss of $4.5 million. The breach was attributed to a coding error related to rounding in Radiant Capital's codebase, which allowed the attacker to profit from repeated deposit and withdrawal operations.

In response to the incident, Radiant Capital swiftly initiated a debt repayment plan. On January 23rd, they successfully made an initial payment of 1190 ETH, equivalent to $2.6 million USD, leaving approximately 720 ETH (about $1.6 million USD) of outstanding debt.

Radiant Capital's team announced that the remaining debt would be repaid over the next 90 days using OpEX funds as per RFP-27, with the option to tap into DAO reserve funds if liquidity becomes available sooner. The repayment plan, outlined in RFP-27, gained approval on January 8th, with 73% of users voting in favor of settling the outstanding debt, given the available treasury funds and operational expenses.

At the time of the proposal, Radiant DAO's treasury balance stood at $5.2 million, and the protocol's monthly income was approximately $500,000. The developers emphasized the importance of recapitalizing the protocol to ensure its security and provide uninterrupted access to deposits for all users.

This incident serves as a reminder of the ongoing security challenges in the cryptocurrency space, highlighting the need for robust protocols and quick responses to security breaches.