Asset Price Distortion

Definition ∞ Asset Price Distortion describes a situation where a digital asset’s market price deviates from its underlying economic value due to external factors. These factors can include market manipulation, illiquidity, or technical glitches rather than genuine supply and demand dynamics. This condition misrepresents the true worth of an asset.
Context ∞ Regulatory bodies and market participants express ongoing concern about asset price distortion in digital asset markets. Such distortions can undermine investor confidence and market integrity. Monitoring and addressing these anomalies are vital for fostering transparent and equitable trading environments within the cryptocurrency sector.

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→Asset Price Distortion

→Smart Contract Logic

→Third Party Dependency

Moonwell Lending Protocol Drained by Stale Price Oracle Manipulation Attack

Protocol integration of a deprecated price feed enabled an attacker to collateralize virtually worthless tokens for $1.1 million in illicit loans.

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→Oracle Manipulation

→Price Feed Error

→Bad Debt

Moonwell Lending Protocol Drained by External Oracle Price Manipulation

Transient oracle pricing error on Base allowed negligible collateral to be valued at millions, exposing systemic risk in external data feeds.

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→Contract

→Data

→Liquidation Bypass

Moonwell Lending Protocol Drained by Chainlink Oracle Price Manipulation on Base

A transient oracle malfunction on the Base L2 allowed collateral mispricing, exposing a critical systemic risk in the protocol's asset valuation logic.

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→Wrapped Assets

→Protocol Insolvency

→Risk Mitigation

Lending Protocol Exploited via Oracle Mispricing on Base Network

An external oracle failure mispriced wrstETH collateral, allowing the attacker to borrow millions against negligible deposit value, compromising protocol solvency.

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→Token Contract Vulnerability

→Token Price Volatility

→Solvency Check Bypass

Yield Platform Typus Finance Drained by Oracle Price Manipulation Flaw

An oracle manipulation vulnerability in a TLP contract allowed the attacker to distort asset price feeds and drain $3.4 million.