Term Finance Loses $8.5 Million to Governance System Exploit

Ethereum-based lending platform Term Finance lost an estimated $8.5 million after an attacker exploited a weakness in its governance system.

The attacker acquired enough voting power to take control of Meta Vaults, a product used by the platform's users for lending and borrowing.

The attacker withdrew approximately 2,843 ETH worth about $6.9 million at the time and 1.68 million USDC, draining around 68% of the vaults' assets.

Term Finance said its broader lending and borrowing markets were not affected by the attack, but it has permanently shut down the Meta Vaults product, blocked new deposits, and removed governance permissions that allowed changes to the vaults.