Moonwell Halt Lending After MAMO Price Manipulation Incident

Moonwell, a decentralized lending protocol on the Base network, has suspended new lending activity following a suspected price manipulation incident involving the MAMO token. The incident, which occurred on March 24, 2025, resulted in approximately $6 million being drained from the protocol.

In response to the attack, Moonwell reduced borrowing caps across all Core markets on Base to one wei, effectively preventing any new borrowing. The protocol also lowered supply caps for MAMO and WELL to one wei, while leaving supply caps for other assets unchanged.

The suspected manipulation targeted the MAMO Core market, where the price of MAMO was likely manipulated to enable the attacker to borrow against inflated collateral. This type of attack, often called a 'price oracle manipulation,' exploits vulnerabilities in how decentralized finance (DeFi) protocols determine asset values.