Solana-Based DeFi Protocol Loses $661k After Shutting Down By Mistake
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Solana-Based DeFi Protocol Loses $661k After Shutting Down By Mistake

Solana-based decentralized exchange OptiFi lost $661,000 in USDC after accidentally shutting its mainnet program.
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OptiFi, a Solana-powered decentralized exchange, lost $661,000 after accidentally shutting down its mainnet program. While the funds are not recoverable, OptiFi said it will “compensate all users’ funds” and make sure something similar does not happen again.

OptiFi Promises to Compensate All Affected Users

OptiFi, a derivatives decentralized exchange (DEX) powered by Solana and Serum, announced it has lost $661,000 in USD Coin (USDC) after shutting down its mainnet program by mistake. OptiFi was unable to recover the funds as all 661,000 USDC remained locked in the Program Derived Addresses (PDAs), but the exchange promised to compensate all affected users.

“On 29th August around 06:00 UTC, we had an update to our @solana program code, and our deployer tried to upgrade the OptiFi program on Solana mainnet. However the deployer accidentally used the solana close program command, resulting in our OptiFi program being shut down.”

OptiFi wrote in a tweet.

According to Pyth oracle, OptiFi will return the funds and “settle all user positions manually” on September 2 at 8 AM UTC. The protocol’s team said all of the deposits will be based on Solscan and directed the affected users to its Discord server for further assistance.

Explaining how it all happened, OptiFi said one of its developers used the ‘anchor deploy’ command to upgrade its program. However, the process took much longer than expected, likely due to network congestion.

The developer then aborted the deployment before receiving the response message, but the move had created an unused buffer account containing 17.2023808 SOL. After that, the deployer attempted to shut down the buffer account and retrieve its balance but they unintentionally closed the mainnet program instead of the buffer account.

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2022 Keeps Getting Worse for Solana Protocols

OptiFi’s accident marks the latest in a series of troubles faced by Solana and Solana-based protocols this year. A month ago, Solana-powered protocol Nirvana Finance suffered a $3.5 million exploit as a result of a flash loan attack.

The layer-1 blockchain saw several network halts this year, pushing its price further down amid an already-bad crypto market downturn. The cryptocurrency is down more than 80% year-to-date.

To make things worse, Solana has fallen victim to a major hack earlier this month. The attack affected more than 8,000 wallets and drained roughly $8 million, though the Solana team claimed no hardware wallets were impacted.

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Do you think network halts and exploits are the primary reason behind Solana’s sharp drop this year? Let us know in the comments below.

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