• Crypto lender Geist Finance is shutting down permanently due to losses from a Multichain exploit.
• The exploit caused oracles to misreport Multichain token values, making it “impossible” to reenable lending.
• Geist had over $29 million worth of crypto assets locked in its contracts before the hack.
Geist Finance Shuts Down After Exploit
Crypto lender Geist Finance is shutting down permanently due to losses from a Multichain exploit, according to a July 14 social media post from the app’s development team. Before the hack, Geist allowed users to borrow, lend or use bridged tokens from the Multichain platform as collateral and had over $29 million worth of crypto assets locked in its contracts.
Exploit Causes Oracle Misreporting
The exploit caused oracles to misreport Multichain token values, making it “impossible” to reenable lending. Chainlink oracles were used by Geist Finance to track the prices of these assets in order to determine their collateral and loan values. These oracles have stopped producing reliable information as they are now listing the values of the non-bridged versions of each coin which are more than four times higher than their Multichain derivatives.
Geist Contracts Paused & Resumed
Geist contracts were paused on July 6 and then resumed in “withdraw and repay only” mode on July 9 after confirmation that funds would not be recovered. The team clarified it is not blaming Chainlink oracles for Geist’s closure as these oracles “worked as they should.”
Losses Too Great To Reopen Platform
Because doing so would result in bad debt for holders of non-Multichain coins such as Magic Internet Money (MIM) or Fantom FTM $0.27 , it was determined that losses were too great for them reopen lending and borrowing on Geist again.
Conclusion: No Plans To Reopen Platform
As a result, Geist will not be able to reopen lending and borrowing protocols on its platform again with no plans currently in place for this action.