Pike Finance, a decentralized finance (DeFi) protocol, recently made clarifications regarding a previous statement about a $1.6 million exploit involving USDC Coin (USDC). Initially, the exploit was attributed to a vulnerability in USDC. However, Pike has since clarified that the issue was not with USDC itself but rather with Pike's integration of third-party technologies.

The exploit, which occurred on April 30, was due to security oversights within Pike Finance’s smart contract functions, particularly in handling transfers with the Cross-Chain Transfer Protocol (CCTP), managed by USDC's issuer, Circle. Pike acknowledged that the root cause was unrelated to Circle’s product offerings but was instead a result of Pike's failure to properly integrate certain technologies, including CCTP and the Gelato Network's automation services.

This misstep was identified by Pike's auditing partner, OtterSec, during an earlier breach on April 26 that resulted in a $300,000 loss. Despite the identification of this vulnerability, Pike’s development team was unable to address it in a timely manner, leading to the subsequent and more significant exploit.

During the April 30 attack, an attacker exploited this unresolved vulnerability to extract approximately $1.68 million worth of assets across multiple blockchains: Ethereum, Arbitrum, and Optimism. This included $1.4 million in Ether, $150,000 in Optimism (OP) tokens, and about $100,000 in Arbitrum (ARB) tokens.

Pike Finance has acknowledged that both incidents stemmed from the same vulnerability in their smart contract. The specific issue in the contract allowed attackers to bypass administrative controls and withdraw funds, underscoring the critical importance of timely and effective vulnerability management in the DeFi space.

The clarification from Pike comes at a time when the broader cryptocurrency market has seen a notable reduction in the losses due to hacks. PeckShield reported that the total losses from crypto-related hacks in April saw a significant decrease, totaling $60 million, compared to $360.8 million in February and $187.6 million in March. This trend indicates a potential improvement in security measures and protocols across the industry, even as individual platforms like Pike Finance navigate their security challenges.