TapiocaDAO Token Plunges 95% After Hack

TapiocaDAO, an omnichain money market built on LayerZero, suffered a security breach of its token deployer address early Friday morning. Cybersecurity firm Cyvers alerted that an attacker had drained and swapped nearly $1.6 million worth of TAP tokens, prompting the token to collapse 95%.

The news is devastating for a project that had reportedly spent $2.1 million on audits and recently launched its testnet.

According to Cyvers, an exploiter used the Emergency Rescue function on a Tapioca vesting contract and funneled nearly 28 million TAP tokens to an address under their control. These tokens were then dumped for 591 ETH in a single transaction and bridged to the BNB Chain from Arbitrum.

“The function was accessible to anyone, revealing a major security oversight by Tapioca,” said Cyvers. ZackXBT added that the project fell victim to a contagious interview scam that has hit several protocols of late.

TAP is on life support after dropping more than 95% to $0.07.

Hakan Unal, Senior SOC Lead at Cyvers, told The Defiant that this type of breach is common. He explained that the deployer controlling the TapiocaDAO contract likely downloaded malware, which gave the attacker access to the keys and the smart contract.