The company announced to its users that the platform has been largely restored. However, he stated that the staking service is still in the “patching and auditing” process. This announcement comes on the heels of Thala’s security breach on November 15.

A day before the breach, a vulnerability was detected in the Thala protocol, and a malicious actor was able to withdraw a large amount of liquidity tokens thanks to this vulnerability.

The company stated that the incident was caused by an isolated security vulnerability that emerged after a recent update to the protocol’s v1 farming contracts. This was an important reminder in the industry that contracts must be carefully tested and audited.

According to Thala’s statement, as soon as the security breach was detected, all services in the protocol were immediately suspended and the system was frozen by rapid intervention. The company managed to freeze assets worth $11.5 million, consisting of Thala-related assets such as the THL token and Move Dollar (MOD).

The Move programming language, which forms the basis of the Aptos blockchain on which Thala works, made it possible to perform this fast freezing process. Move treats digital assets as first-class resources and includes built-in functions such as freezing and burning.

Thala collaborated with experts in the industry to recover lost assets. In this process, DeFi security experts SEAL 911, on-chain researcher Ogle and law enforcement came into play. Through negotiations with the person behind the attack, the hacker agreed to return all stolen user assets in exchange for a $300,000 reward.

Thala guaranteed that thanks to this agreement, all users’ positions will be “100% restored” and users do not need to take any action. This type of solution stood out as an example of the “white hat hacker” practice that is frequently discussed in the industry.

Following the incident, the total value locked (TVL) on the Thala platform dropped significantly. While there was $234 million in locked value on the platform before the security breach, this figure dropped to $196 million after the incident.

Additionally, Thala’s native token, THL, lost more than 31% of its value following the attack. The loss of value shows that investor confidence needs to be rebuilt.

This incident attracts attention as part of the increasing attacks on DeFi protocols recently. On October 16, DeFi lending platform Radiant Capital suffered losses of approximately $50 million as a result of the exploitation of a backdoor contract.

Similarly, in September, staking protocol Bedrock reported that nearly $2 million in digital assets were stolen due to a software bug. Such attacks reveal how fragile the decentralized finance space can be in terms of security.

According to blockchain security firm PeckShield, in October alone the crypto industry suffered $88.4 million in losses from various attacks. In total, losses on the chain reached $181 million. This situation once again reveals that the cyber security of decentralized protocols needs to be further improved.

This breach experienced by Thala emphasizes the importance of security-oriented approaches in the development of DeFi protocols. Keeping user funds safe and constantly monitoring protocols is critical for the sustainability of projects in this field.

In particular, security-focused solutions such as the Move programming language can contribute to preventing similar incidents in the future. However, despite all these efforts, completely eliminating security vulnerabilities in the world of decentralized finance still remains a great challenge.