Visor Finance (VISR), has been in a free fall ever since Tuesday, December 21. In the past 24 hours, it dropped by 95.01%.
Many crypto traders and investors were taken by surprise by the sudden fall. This is especially surprising considering that most expected the price of crypto to reach $1.0 by the end.
This is a comprehensive overview of the causes of this dramatic fall.
What is Visor Finance?
Before we get into the details of what’s causing the freefall, let’s first clarify what Visor Finance actually is.
Visor Finance, a Uniswap-based protocol, is specialized on NFT smart vaults to provide liquidity provisioning. It predicts the DeFi environment where market conditions could unlock liquidity from networks independent smart vaults.
Why is Visor Finance pricing falling?
After a hack by the Visor team, the Visor Finance price has fallen.
At the time this article was written, the team was trying fix an exploit by hackers that rob 8.8 million of vVISR tokens. But, despite all the efforts to address the issue, token prices continue to plummet.
The hackers the vVISR staking contract through a re-enter hack to double mint vVISR tokens and also allowing tokens to be limitlessly and freely minted.
We have identified an exploit in the vVISR staking agreement and are implementing a migration plan to assist VISR. Hypervisor’s and positions are not at risk.
— Visor Finance (@VisorFinance) December 21, 2021
Visor however stated that the exploit does not pose a risk to any positions or hypervisors and that affected vVISR stakers will be able to get their tokens back. It also said that it will apply the ‘’token migration’’ based on the pre-exploit protocol.
The team stated:
“Trades subsequent to the vVISR exploit will not affect your redeemable amount,”
After the hacker had sold all tokens through Uniswap, the exploit negatively affected the vVISR prices. He then used Tornado Cash (a non-custodial privacy protocol built upon Ethereum) to hide his identity and track.
Visor has suffered a number of major hacks in the past. The network was hacked for $500 million in June. This was about 16% back then. Similar circumstances occurred at SquidGame in October, when the scammer fled with the stolen funds.
Defi Hack is on the rise
Over the last year, there have been numerous scams and hacks in crypto.
The largest DeFi hack was this August, when crypto worth $600million was stolen across multiple networks such as polygon, Binance Smart Chain, Ethereum, and others. This hack became one of history’s most dominating dollars.