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DeFi is a house of cards
Remove 1 card → the entire floor collapses
Everyone saw the $80m Resolv hack
But the $USR depeg triggered a cascade of Bad Debt on lending markets...
Someone pulled off a clever "exploit" on Morpho for $300k
Here's how it worked 👇
Re7 USDC vault + USR/USDC market on @MorphoLabs had a fatal flaw:
Oracle price was hardcoded 1:1 for USR:USDC
Didn't matter what happened on DEX... 1 $USR = 1 $USDC inside the market
The exploit:
1️⃣ Flashloan 100m $USDC
2️⃣ Deposit into Re7 USDC vault
3️⃣ Curator auto-allocates to USR/USDC market
4️⃣ Buy depegged $USR cheap on DEX
5️⃣ Deposit $USR as collateral, borrow $USDC at 1:1 ratio
Profit: ~$300k
TX:
...

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