Term Labs Suffers $8.5M Governance Exploit on Ethereum

A governance exploit drained an estimated $8.5 million from Term Labs, operators of an Ethereum-based fixed-rate lending protocol.

The attacker gained enough governance power to execute malicious proposals against vaults operated by Term Finance, turning control of governance into control over deposited assets.

The affected vaults were found to be connected to wallets that were funded through Tornado Cash before the attacker accumulated voting power.

This exploit is similar to a recent attack on BonkDAO, which lost roughly $20 million in BONK after an attacker accumulated enough voting power to pass a malicious proposal through Solana's Realms governance system.