Prisma Finance, a DeFi protocol specializing in stablecoins backed by Ethereum liquid staking and re-staking tokens (LRTs), suffers a $12 million loss due to a cyber attack.

Initially detected by Cyvers, a blockchain security company, the attackers managed to drain a total of 3,258 ETH. In response, the Prisma team promptly halted the protocol and issued a statement advising users to revoke consent for the affected smart contracts.

According to an analysis by Peckshield, a cybersecurity firm, the stolen assets were dispersed across three Ethereum addresses.

Following the incident, the PRISMA token experienced a 30% decline, but some recovery was observed later. It is currently valued at a market capitalization of $9 million. The attack resulted in a total of approximately $110 million being withdrawn from the protocol, leaving $127 million in total value locked (TVL).

Prisma issues two-dollar pegged stablecoins, known as mkUSD and ULTRA, which can be minted against Ethereum liquid staking tokens (LSTs) and re-staking tokens (LRTs). The primary mkUSD has a market capitalization of $35 million, while the newly introduced ULTRA stands at just over $2 million.

PRISMA's design is influenced by the release of LUSD, Liquidity, which reassured its community on X about having its own defenses against similar attacks.