Ethereum, the DeFi platform Makina Finance lost 1,299 ETH worth approximately $4.1 million on January 20 after hackers manipulated the price oracles on its DUSD-USDC liquidity pool hosted on Curve Finance.
A MEV builder frontrun the attack and captured the majority of the stolen funds, complicating recovery efforts for this yield management protocol launched in February 2025.
The blockchain security company PeckShield detected the exploit for the first time at 03:40:35 UTC, with the attacker having converted the stolen tokens into ETH on two wallets that currently hold the assets.
What happened
The attacker took out a flash loan of 280 million USDC, using 170 million to manipulate the MachineShareOracle that determines the prices of the Dialectic USD and Dialectic USDC stablecoin pool.
After artificially inflating the prices of the pool, the attacker exchanged 110 million USDC against the manipulated pool to drain 1,299 ETH before repaying the flash loan.
PeckShield confirmed that the attack exploited a price manipulation vulnerability, the attacker adding liquidity just before inflating the prices and then withdrawing it with profits.
However, an address of MEV builder starting with 0xa6c2 front-ran the transaction that emptied the pool, capturing about 4.14 million dollars of stolen funds.
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Current situation
The stolen ETH is currently located on two Ethereum addresses: wallet 0xbed2...dE25 holding 3.3 million dollars and wallet 0x573d...910e containing 880,000 dollars.
Makina has activated security mode on all its smart contracts and advised liquidity providers of the DUSD pool on Curve to withdraw the remaining funds.
The platform confirmed that the exploit only affected the positions of DUSD liquidity providers on Curve, with other assets and deployments remaining unchanged.
Security firms including PeckShield, ExVul, and TenArmor have urged users to revoke permissions for smart contracts and to avoid any interaction with Makina's contracts pending the investigation results.
DeFi Security Context
Exploits via flash loans remain common despite increased security, with the decentralized exchange Bunni losing 8.4 million dollars in October 2025 and Shibarium suffering a 2.4 million dollar attack in September.
However, Chainalysis data shows that losses related to DeFi hacks remained moderate throughout 2025, even as the total value locked reached 119 billion dollars, breaking with historical trends where capital inflows were accompanied by an increase in attacks.
The total theft of cryptocurrencies reached 3.4 billion dollars in 2025, but the target of attacks shifted towards centralized platforms and personal wallets rather than DeFi protocols.
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