Early on Tuesday, Certik was the first to identify the suspicious activity, announcing on platform X: “We have identified several dubious transactions on Base… The perpetrator has siphoned approximately $1.6 million from Arcadia Finance, probably via random ‘swapdata’ on its rebalancer contract.“

After a few hours, Certik updated their initial report stating that the “attack” had continued and the total losses had now escalated to around $3.5 million.

Arcadia’s team responded to the breach quickly, posting on X: “We are mindful of unauthorized transactions via a Rebalancer. All asset managers should revoke all permissions immediately.” In addition, the company cautioned its users on its official website to “disconnect rebalancers and compounders” from their accounts.

Arcadia, a platform and margin protocol backed by Coinbase Ventures, provides users the ability to lend, borrow, and trade assets without needing permission.

Certik, a prominent web3 security firm in the digital assets industry, reported last month that crypto users and DeFi protocols suffered losses amounting to $302 million due to hacks and scams in May, marking a 16.9% decrease compared to the previous month.

Supported by dominant firms like Sequoia Capital, Tiger Global and Goldman Sachs, Certik’s valuation stood at $2 billion as of last year.

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