
Weekly Report (Apr-17)
Yearn Finance, & Hundred Finance exploit. Canon, Adidas, and Mastercard web3 initiatives.
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After much deliberation and careful thought Neptune Mutual decided to close the cover marketplaces.
After much deliberation and careful thought Neptune Mutual decided to close the cover marketplaces. Below the reasons for the decision as well as what it means for the community.
The marketplaces will be closed using an emergency withdrawal process whereby the liquidity provided to cover pools by LPs will be returned to the wallet addresses from which the liquidity was supplied. In addition to protecting cover pool LPs, there will also be refunds to all cover policy purchasers with an existing and valid policy who have paid over 10 USD in policy fees in one transaction.
For veNPM holders, please fill out this form to receive a refund for your veNPM to NPM conversion penalty.
From the end of June there will no longer be NPM emission incentives for LPs i.e. Epoch 3 of the liquidity gauge emissions will be canceled.
Unused funds raised from financial backers will be returned to those backers; this includes DEX liquidity that has now been removed from SushiSwap and Uniswap. A small amount of liquidity on SushiSwap Arbitrum has been left to enable a minimum amount of NPM trading.
The protocol will be open sourced, and become a true public good. Enabling the community to fork the code developed by the Neptune Mutual team such that others might use the existing resources to further our mission to make the blockchain space better protected against smart contracts and other risks.
There are numerous factors that have led to this difficult decision, some of which are external factors which are uncontrollable or unforeseeable. A few factors summarized below:
“Given Neptune Mutual’s Tier 1 backers, why have you not listed on a top CEX?”
This is perhaps one of the most frequently asked questions. In short, the answer is that for a variety of reasons Neptune Mutual was not able to achieve the diverse set of performance metrics (community size and engagement, marketplace user activity, DEX 24 hour trading volume, TVL growth etc.) required to list on top tier CEX. The CEXs that are prepared to list NPM token do not have the depth of liquidity or breadth of user-base to offer good prospects for NPM tokenholders.
The above point invariably leads to the question
“Why has Neptune Mutual not achieved strong growth?”
It is tempting to take a shortcut to answer this question by pointing a finger at one specific factor, but the reality is that there are many contributing factors. A few summarized below:
Since the outset of engaging with the community we have endeavored to highlight the need for DeFiInsurance; Neptune Mutual built a comprehensive dataset of on-chain hacks available, anywhere, and each week we highlight the many millions of dollars that are stolen as a result of smart contract hacks. Despite this, we have consistently been confronted by projects unwilling to spin up cover pools in our marketplace because of the sentiment that audits of their code are sufficient to persuade their community that their protocol is safe. Less than 0.3% of all digital assets are protected with some form of DeFiInsurance, and yet despite all the media reports of hacks, the conference discussions about the importance of governance or CEX proof-of-reserves, it continues to be the case that it is extremely difficult to get media attention to focus on the need for a fast and efficient means of mitigating smart contract risk.
A variety of approaches have been taken by different DeFiInsurance protocols to address this, from attending multiple conferences throughout the year and significant marketing spend, to the leaner approach that Neptune Mutual took (in part as a result of the bear market in 2023). What can be said is that no DeFiInsurance protocol has managed to achieve significant growth over the last 18 months, sadly the overall TVL of the sector has shrunk a lot.
For all the reasons above, at this moment the best course of action is no longer to double-down on investing in growth, but rather to refund unused capital and close the marketplaces.
The consequences are very tough for the Neptune Mutual team who have spent the past 3 years of their time on the mission to facilitate safer environments within DeFi. The team has delivered products according to the roadmap and the fact that the protocol was never hacked, despite attempts being made on the darkweb, is testament to the expertise, passion and absolute focus on security. The team survived the FTX and UST crisis unscathed, and believed that the continued growth in hacks would lead to growth in the demand for a good solution to mitigate these risks, but sadly, as can be seen right across the DeFiInsurance category, this is not yet in sight. So we would like to thank the team for all the dedication, skill and passion invested into the Neptune Mutual project since the outset.
The team will open source the protocol, including blockchain indexing protocol (subgraph alternative), frontend, middleware, database, and backend code, to make it a true public good. This will allow anyone to fork the code and create covers by defining parameters and premium ranges, potentially leading to innovative covers and organic usage.
The Discord channel will be closed to reduce the risk of phishing and other types of cyber attack, any questions / queries will be responded to in the Telegram channel.
We want to take this final opportunity to thank you all for your support.
Neptune Mutual will contact only its financial backers, with whom a signed agreement exists, in relation to next steps (i.e. holding NPM tokens does not qualify you for any form of refund). Contact will be made only from a neptunemutual.com domain email address so please check the source of any email you may receive very carefully. Please ignore any messages from any other email or social media accounts in relation to token/cash refunds.
Warner Music Group has collaborated with OpenSea to expand Web3 opportunities for artists.
More than $2.7 billion has been hacked this year so far, with $181 million lost in September alone due to multiple hacks, scams, and smart contract vulnerabilities.
The MEV bot named 0xbad made a windfall when a trader attempted to exchange $1.85 million Compound cUSDC for USDC on Uniswap v2, but was only able to receive back $500 in USDC due to a lack of liquidity. 0xbad made a tidy profit of 800 ETH, or nearly $1 million from the swap, backrunning the trade with an elaborate arbitrage involving many different DeFi dApps. However, an anonymous hacker exploited a vulnerability in the bots' arbitrage contract code, and stole not only the recently acquired 800 ETH, but the entire 1,101 ETH in 0xbad’s wallet, amounting to approximately $1.5 million.
BXH was the victim of another flash loan attack in which the contract lost 40,085 $USDT, with the attacker making a profit of 31,794 $USDT after paying off the flash loan fee. The team had most recently updated their TokenStakingPoolDelegate contract following their earlier loss of $2.5 million due to a compromised private key. The getReverse function of the contract's getITokenBonusAmount function was utilized in the flash loan attack to retrieve the instantaneous quotation, which the attacker then manipulated to obtain his share of the rewards.
A hacker exploited an internal bug in a swap contract, causing Transit Swap, a multichain decentralized exchange aggregator, to lose approximately $21 million. According to reports, the attack was the result of a compatibility problem or a misplaced trust in the swap contract. Following the disclosure, Transit Swap apologized to users, and efforts are currently underway to locate and recover the stolen funds. The team collaborated with multiple security firms to track down and communicate with the hacker, resulting in the return of nearly 70% of the stolen funds.
Warner Music Group (WMG) has announced a collaboration with NFT marketplace OpenSea to create a venue for select musical artists to build and expand their fanbase into the Web3 community. The collaboration between these two entities will provide selected WMG artists with early access to OpenSea's newly launched feature, which enables artists to launch their NFT collections and limited-edition projects on their own customizable and dedicated drop pages. These WMG artists will have access to personalized storytelling on customized landing pages, as well as industry-leading safety and security features from OpenSea. The collaboration intends to introduce existing fan communities on OpenSea to new forms of connection and creativity through NFTs, as well as to provide new opportunities for fans to interact with music and artists within the Web3 community.
Meta, the parent company of both Facebook and Instagram, announced a new step in its digital arts initiative. Now, all users on both platforms can connect their wallets and share NFTs in 100 countries. As part of the feature, which has been in testing since May, users will be able to tag creators and collectors and cross-post digital collectibles between platforms without having to pay any fees.
Walmart has taken its first foray into the Metaverse with the release of Walmart Land and Walmart’s Universe of Play on Roblox. The focus of Walmart Land is on immersive experiences, with highlights including a Ferris wheel that defies the laws of physics, unlockable tokens and badges, an interactive piano walkway, and a D.J. booth for users. The virtual world will also include products from Lottie London, Bubble, UOMA by Sharon C, and other brands, as well as a store of virtual merchandise, or verch for user avatars. Electric Fest, a motion-capture concert featuring YUNGBLUD, Madison Beer, and Kane Brown, will be added to Walmart Land in October.
In honor of the 47th anniversary of Muhammad Ali's landmark "Thrilla in Manila" fight, the first set of playable avatar boxers in an Artificial Intelligence metaverse boxing game titled Muhammad Ali - The Next Legends was released. Altered State Machine (ASM), Non-Fungible Labs (NFL), and Muhammad Ali Enterprises (MAE) were the stakeholders behind the project. The boxing avatars' initial release included a drop of the limited-edition Pro Pack bundle. Users who purchased one of these Pro Packs were automatically upgraded beyond the beginner level. To clarify, the first two avatars are Rookie, which can be obtained with an unlimited mint, and Pro, available with a Pro Pack mint. Then, Champ and Legend will become available as the level increases.
OneFootball, one of the leading sports platforms, has launched a new NFT drop in conjunction with Serie A. This drop featured 108 outstanding football moments from Serie A matchdays 2, 3, and 4 of the current season. This includes assists, saves, and even goals from SSC Napoli, A.C. Milan, and Juventus. With this release, OneFootball fans will not only be able to collect these top moments on their platform, but they will also be able to participate in challenges to win tickets to actual matches, autographed jerseys, and other rewards.
After a brief pause following the TerraUST de-peg crisis, Insurace Protocol has relaunched coverage for stablecoin de-peg products, initiating with USDT and BUSD.
Nexus Mutual dApp is now available in the Gnosis Safe application, offering comprehensive security for Safe users with assets worth more than $39 billion held in Safe multi-sigs.