Platypus Finance Suffers $8.5M Attack, USP Stablecoin Loses Dollar Peg

The decentralized finance (DeFi) platform Platypus Finance was attacked in a flash loan exploit, resulting in the protocol's stablecoin, Platypus USD ($USP), losing its dollar peg and falling to 48 cents from $1. $PTP, the token of Platypus has dropped 29%.

The attack could potentially cause a loss of $8.5 million. The loss in the stablecoin's price is a result of the exploit. The situation has prompted Platypus to pause all its operations until it gets more clarity on the issue.

Platypus Finance is built on the Avalanche blockchain and serves as an automated market maker where crypto traders can swap stablecoins. The protocol launched $USP, its native over-collateralized stablecoin on February 6, 2023