After Nearly Half a Billion Dollars was Stolen from 2021-2022, Umee’s Historacle Prevents Manipulation Targeted at Small Cap Tokens
NEW YORK–(BUSINESS WIRE)–Umee, a Cosmos blockchain built for seamless cross-chain borrowing and lending of digital assets, today announced the launch of the Historacle – the industry’s first price calculation method to generate true and manipulation-proof on-chain prices. Created as a solution to the numerous price attacks on lending protocols, the Historacle is the first ever Smart Oracle solution that brings business logic into on chain price feeds to prevent manipulation targeted specifically at small cap tokens.
The need for this price calculation method has never been more necessary. Over $350 million was exploited through price manipulation in 2021, according to the most recent data, and high profile attacks have continued through 2022. Many small cap tokens were impacted – Inverse Finance fell victim to a hack and saw a $15.6 million loss in April, while GMX lost over $565,000 in September. Protocols such as Fortress, Mango Markets and Moola Market suffered $3 million, $115 million and $8.4 million losses, respectively.
In providing the industry with better risk management and analysis tools, Umee aims to use the Historacle towards protecting small cap tokens from price manipulation and preventing losses due to oracle attacks. The Historacle calculates prices by taking stamps of the time and volume weighted average prices (TVWAP) from multiple periods of time and price sources, and creating a database of that price information while storing it on-chain. Concurrently, the Historacle uses customized algorithms based on asset specific use cases and their risk profiles to manage prices used for borrowing, lending, collateralization, and liquidation. This product allows protocols to decide whether price action is accurate and it prevents both upward and downward price manipulation conducted through any selected trading venues. It ensures that Umee users experience the best safety measures to conduct lending and borrowing on the Umee blockchain. In the near future, the Historacle will be enabled on the Ojo blockchain to serve as a new data feed product for the overall Cosmos DeFi ecosystem.
“By launching and adopting the Historacle, Umee is now able to list a wider range of tokens for lending and borrowing, while still ensuring the highest safety standards,” said Brent Xu, Founder and CEO of Umee. “Over the last year, we have witnessed too much exploitation in this space. At Umee, we were determined to develop a solution that wouldn’t just benefit us, but the larger industry as a whole.”
To begin lending and borrowing with Umee, visit app.umee.cc.
Umee is a Cosmos-based decentralized lending hub supporting a suite of composable debt primitives that will enable the next generation of global debt markets connecting borrowers and lenders across all crypto ecosystems. To learn more, visit umee.cc.
Holly Dugan, [email protected]