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Following the suspension of Curve Finance (CRV) deposits and withdrawals, a drastic change has been witnessed on the South Korean cryptocurrency market. The prices of CRV, the native token of the decentralized finance (DeFi) protocol, have soared drastically on two major South Korean exchanges, Upbit and Bithumb.
According to recent data, the CRV price on Bithumb has rocketed to approximately $4.73, marking a massive premium of 640%. Meanwhile, on Upbit, the price of CRV hovers around $0.81. It is worth noting that Bithumb and Upbit are the third and fourth in CRV spot trading volume, respectively, globally. The combined trading volume of these two exchanges over the past 24 hours is an impressive $60 million USD.
Due to the suspension of CRV deposits and withdrawals, the CRV prices of the two major South Korean exchanges, Upbit and Bithumb, have seen a significant premium.
The current Bithumb CRV price is about $4.73, with a premium rate of about 640%; Upbit CRV price is about $0.81.…— Wu Blockchain (@WuBlockchain) July 31, 2023
This price anomaly comes in the wake of a severe incident involving Curve Finance. Certain types of the Curve factory pool suffered a "reentrancy" attack, leading to a total loss of millions of dollars. As a result, CRV deposits and withdrawals were suspended on numerous platforms, including Upbit and Bithumb.
The loss resulted from an incorrect implementation of the reentrancy guard in the smart contract's "add_liquidity" and "remove_liquidity" functions. Typically, a reentrancy guard prevents a function from being called again until the first call has been completed. But due to a loophole, a hacker could call the functions multiple times, extracting funds with each call.
Gamza KhanzadaevAlthough the founder of Curve Finance intervened by repaying a portion of the lost funds and depositing a substantial amount of CRV into a DeFi platform, this security breach has led to a significant disturbance in the market dynamics of CRV.
The unexpected surge in the price of CRV on South Korean exchanges reflects the market's response to this incident. While the market is still grappling with the effects of the attack, the situation also brings to the fore the inherent security risks in DeFi platforms and the pressing need for effective safeguards. As the market continues to react and adjust, it remains to be seen how Curve Finance will address these vulnerabilities to restore confidence among its users.
Alex Dovbnya
Vladislav Sopov
Dan Burgin
U.Today Editorial Team