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Decentralized finance (DeFi) hit the pause button early Tuesday after a hacker exploited the platform with complex set of transactions, yielding a profit of more than 2378 ether (ETH).

The hacker took a flash loan of 7500 ETH, of which 3518 were converted to Synthetix's USD stablecoin (sUSD), which were then used as collateral for the bZx loan.

The hacker then boosted sUSD prices to $2 by placing buy order worth 900 ETH for the stablecoin on Kyber Network.

Using the inflated collateral, another loan of 6,796 ETH (roughly $1.8 million) was raised through bZx, which was then used to pay back the original 7,500 ETH loan. In the process, the trader pocketed 2,378 ether. Meanwhile, bZx reportedly lost 2,716 ETH.

The hacker has now left an open loan with half the required collateral now sUSD has returned to its dollar-pegging. bZx fell victim to a similar flash-loan based attack on Feb. 14, which saw hackers take away $2,300 ETH.

A few observers are blaming flash loans for the recent attacks on DeFi. After all, flash loans do not require collateral and reduce costs associated with launching DeFi attacks.

That said, the real issue could be with the decentralized exchanges, which are prone to manipulation due to poor liquidity, as noted by Emin Gün Sirer, CEO of AVA Labs.

Golden Cross Confirmed

BTC: Price: $9,680 | Market cap: $176 billion | 24-Hr Volume: $42.60 billion

Trend: Deeper pullback likely

Bitcoin's 50-day average has crossed above the 200-day average, confirming a golden crossover for the first time since April 2019.

So far, however, that has failed to inspire the bulls. The cryptocurrency faced rejection above $9,800 during the Asian trading hours and is currently chipping away at the support of the trendline rising from Jan. 3 and Jan. 26 lows.

With the bulls refusing to step in, the trendline support at $9,700 could be breached in a convincing manner, as other daily chart indicators are reporting bearish conditions.

For instance, the 5- and 10-day averages have produced a bearish crossover and the MACD is printing deeper bars below the zero line, indicating a strengthening of the downward momentum.

A sustained move below $9,700 would shift risk in favor of a drop to the support at $9,200. On the higher side, a move above $10,051 (high of Sunday's doji) is needed to revive the bullish setup.

Golden cross a bull trap?

Moving averages are based on past data and tend to lag prices. Hence, golden cross is a lagging indicator and has limited predictive powers at best.

More often that not, the market is overbought by the time crossover happens and the confirmation of the crossover is followed by a correction.

Read Analysis

In this feature of the Markets Daily newsletter, we aggregate news, reports, ideas and tweets relevant to crypto traders and investors.

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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.

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