Stableswap Exploit

Definition ∞ A stableswap exploit is a security vulnerability or attack targeting a stableswap protocol, which is a type of decentralized exchange designed for trading pegged assets like stablecoins with minimal slippage. Such an exploit typically manipulates the protocol’s liquidity pools or pricing mechanisms to drain funds or depeg assets. These attacks often result in significant financial losses for users and the protocol.
Context ∞ Stableswap exploits represent a severe threat within the decentralized finance ecosystem, given the substantial liquidity often held in these pools and their role in maintaining stablecoin pegs. The industry continuously works to enhance the security of these protocols through rigorous audits, improved invariant checks, and robust risk management. News frequently reports on successful or attempted stableswap exploits, highlighting the ongoing security challenges in DeFi and the importance of protocol resilience.