SUI Foundation aids AlphaFi in winding down operations after oracle misconfiguration
Summary
AlphaFi is winding down the operation of its protocol following a misconfiguration of its ALPHA oracle that led to the creation of bad debt, as identified by the Sui Security Team. The Sui Foundation is assisting in this resolution to ensure the protocol remains solvent, with no user funds impacted. Users can immediately withdraw their assets from AlphaLend, while Slush Strategies users are also able to access their funds from the USDC, SUI, WAL, and DEEP Strategies without delay. This incident highlighted the effectiveness of the Sui Security Team's tooling, which will be made available to all DeFi protocols later this fall.
Tokens
$USDC$SUI$WAL$DEEP
Analysis
Slush: Slush provides yield-generating strategies on Sui, some of which rely on AlphaFi as a provider. Affected users holding positions in SUI, WAL, DEEP, and USDC strategies are instructed to withdraw principal and yield immediately with no waiting period. Strategies for USDsui and XAUM continue normally via an alternative provider. AlphaFi: AlphaFi runs a DeFi protocol on Sui featuring AlphaLend and various yield strategies. It encountered a misconfiguration in its ALPHA oracle that resulted in bad debt, prompting the decision to wind down operations with assistance from the Sui Security Team. The protocol is facilitating immediate withdrawals to return assets to users. SlushWallet: SlushWallet operates as the platform behind Slush Strategies on Sui, integrating with third-party protocols like AlphaFi. It has notified users to withdraw from impacted AlphaFi-backed strategies to protect assets during the wind-down. Pending withdrawal requests can be canceled and resubmitted for instant access. Sui Foundation: The Sui Foundation supports the development and growth of the Sui blockchain ecosystem and its DeFi applications. In this case, it has decided to assist AlphaFi following the identification of an oracle misconfiguration to ensure the protocol remains wholly solvent. This intervention helps safeguard the broader Sui DeFi environment without impacting user funds. Sui Security Team: The Sui Security Team builds and maintains security tools for protocols operating on the Sui network. Its tooling directly aided in detecting the oracle misconfiguration at AlphaFi. The team plans to launch this tooling publicly later this fall as a shared resource for all DeFi protocols on Sui. Security Tooling: Sui Security Team tooling identified the AlphaFi oracle misconfiguration and will launch publicly later this fall for use by all DeFi protocols on Sui. User Fund Safety: No user funds were impacted by the AlphaFi incident, with immediate withdrawals available for all affected positions and strategies. Protocol Resolution: Sui Foundation assistance ensures AlphaFi winds down while remaining solvent, allowing users to unwind borrow positions and withdraw assets without loss.
Categories
cryptoethereumdefibasehyperliquid