Moonwell Drained for $8.7M on Base Following Collateral Share Manipulation

Moonwell lost approximately $8.7 million on Base after an attacker exploited a pricing and supply mechanism flaw. The protocol's total value locked dropped from about $73 million to roughly $45 million following the incident. The attacker deposited 7.1 million MAMO for 346 million shares before sending 53 million tokens directly to the market contract without minting new shares. This action increased the pool's holdings relative to outstanding shares, pushing the market exchange rate from 0.0205 to 0.0755 and inflating collateral value about 3.7-fold. Against the manipulated collateral, the attacker borrowed cbBTC, USDC, and wstETH, with proceeds converted into roughly 8.73 million DAI. "Borrow caps for all Core Markets on Base have been set to 1 wei, preventing new borrowing and limiting the potential for further impact." — Moonwell