Human error on DeFi protocol causes $3.7M swap failure

A user on YO Protocol received $112,000 instead of $3.73 million after a decentralised finance token swap executed with extreme slippage.

Blockchain security firms flagged the failed transaction on Tuesday after the user attempted to swap Aave’s stkGHO stablecoin for Circle’s USDC.

YO Protocol said its harvesting system mistakenly traded the vault’s entire stkGHO balance at a poor price due to inadequate slippage protection.

Slippage protections were insufficient, and the trade proceeded when it should have been blocked.

YO Protocol said.

The protocol said no user funds were lost and confirmed the issue was immediately fixed after the incident.

YO added that the system was designed for small reward claims and lacked safeguards for large transactions.

The root cause of the incident is typical for yield farming protocols which do perform capital rotation or re-allocation.

Yehor Rudytsia said.

YO Protocol said additional safeguards have now been implemented to ensure safe and reliable operations.

At the time of reporting, Aave price was $173.39.