Term Labs Hit with $8.5 Million Governance Exploit

Term Labs, a decentralized finance (DeFi) lending protocol, suffered a governance exploit on August 23, draining roughly $8.5 million from its vaults.

The attacker withdrew 2,843 Ethereum (ETH) and 1.68 million USDC, swapping the stablecoin into approximately 1.68 million Dai (DAI). The wallet behind the attack was initially seeded with 2 ETH withdrawn from Tornado Cash.

Term Labs has a total value locked of $12.2 million, with $8.6 million on Ethereum. The team is investigating the governance vector and has not yet named the specific function abused by the attacker.