Term Finance Hit by $8.5M Governance Exploit

Term Finance's decentralized lending protocol has suffered an estimated $8.5 million loss due to a governance exploit, according to multiple blockchain security monitoring firms.

The attacker allegedly targeted strategy vaults, which are controlled by governance, and drained approximately 2,843 ETH ($2.456 million) and 1.68 million USDC ($1 million), later converting the stablecoin into about 1.68 million DAI.

Term Labs has shut down the affected vaults and revoked their DAO governance roles to prevent further deposits, while the company investigates the incident and coordinates with external security teams on asset recovery and remediation.