RaftRaft Security Incident: Post-Mortem Analysis and Recovery Plan
On 10 November 2023 at 18:59:23 UTC, Raft encountered a complex security incident, resulting in the minting of ~$6.7 million unbacked R, subsequently, the attacker sold R, causing R's depeg. A public announcement of the exploit was made on 10 November 2023 at 19:18 UTC.The IncidentExploit Transaction: https://etherscan.io/tx/0xfeedbf51b4e2338e38171f6e19501327294ab1907ab44cfd2d7e7336c975ace7 Raft Exploiter: https://etherscan.io/address/0xc1f2b71a502b551a65eee9c96318afdd5fd439fa Exploited ...
RaftUnveiling Raft's LP Staking Mechanism
In our previous blog, we introduced RAFT tokenomics, providing a brief glimpse of how veRAFT fosters community engagement and long-term commitment. Let's dive deeper into veRAFT's mechanics and discover the benefits it offers to the community.RAFT Use CasesRAFT serves two primary functions within our ecosystem:Staking: RAFT token holders can provide liquidity into the RAFT/R 80:20 Balancer pool and stake their Balancer LP token (BPT) into the Raft staking contract for up to 24 month...
RaftRaft integrates with Chainlink CCIP
We’re excited to announce that Raft is integrating Chainlink CCIP—the industry standard for secure cross-chain interoperability. Raft will be launching across the Base and Ethereum mainnets, with plans to launch on Arbitrum and more chains in the near future. We’re leveraging CCIP’s Simplified Token Transfer capabilities to help unlock cross-chain transfers of R.Why CCIP?We selected CCIP as our go-to interoperability solution because Chainlink has a proven track record of maintaining the high...
Raft will voyage again
RaftRaft Security Incident: Post-Mortem Analysis and Recovery Plan
On 10 November 2023 at 18:59:23 UTC, Raft encountered a complex security incident, resulting in the minting of ~$6.7 million unbacked R, subsequently, the attacker sold R, causing R's depeg. A public announcement of the exploit was made on 10 November 2023 at 19:18 UTC.The IncidentExploit Transaction: https://etherscan.io/tx/0xfeedbf51b4e2338e38171f6e19501327294ab1907ab44cfd2d7e7336c975ace7 Raft Exploiter: https://etherscan.io/address/0xc1f2b71a502b551a65eee9c96318afdd5fd439fa Exploited ...
RaftUnveiling Raft's LP Staking Mechanism
In our previous blog, we introduced RAFT tokenomics, providing a brief glimpse of how veRAFT fosters community engagement and long-term commitment. Let's dive deeper into veRAFT's mechanics and discover the benefits it offers to the community.RAFT Use CasesRAFT serves two primary functions within our ecosystem:Staking: RAFT token holders can provide liquidity into the RAFT/R 80:20 Balancer pool and stake their Balancer LP token (BPT) into the Raft staking contract for up to 24 month...
RaftRaft integrates with Chainlink CCIP
We’re excited to announce that Raft is integrating Chainlink CCIP—the industry standard for secure cross-chain interoperability. Raft will be launching across the Base and Ethereum mainnets, with plans to launch on Arbitrum and more chains in the near future. We’re leveraging CCIP’s Simplified Token Transfer capabilities to help unlock cross-chain transfers of R.Why CCIP?We selected CCIP as our go-to interoperability solution because Chainlink has a proven track record of maintaining the high...
Raft will voyage again
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In the thrilling world of decentralized finance, solvency and stability are the dynamic duo that guarantee user trust and adoption.
Enter Raft, a decentralized lending protocol that allows people to take out stablecoin loans against capital-efficient collateral.
Raft’s first stablecoin is called R and is backed exclusively by stETH (Lido Staked Ether). With its eyes set on becoming the number one stablecoin within the decentralized ecosystem, R relies on the powerful tag team of liquidations and redistributions to safeguard its value and maintain solvency.
Let's embark on a journey to understand how these processes work with R.
Liquidations play a vital role in making sure each 1 R is always backed by at least 1 USD worth of wstETH.
An account becomes eligible for liquidation when a Position's Collateral is between the Minimum Collateralization Ratio and 100% collateralization (i.e., 100% < Position's Collateral < 110%).
The liquidation process is initiated when the Liquidator calls the smart contract to perform the liquidation.
The Liquidator pays off the Borrower's Total Debt, and in return, receives the equivalent amount of Matching Collateral and the additional Liquidator Reward, which is based on a pre-defined formula.
Positions below the Minimum Collateral Ratio can be liquidated through the following methods, earning the Liquidator collateral and liquidation rewards:
[Optional Flash Loan]: Borrow Borrower's Total Debt from a Liquidity Pool (such as Balancer).
[Optional Flash Mint]: Flash mint Borrower's Total Debt directly from RAFT.
Call the Liquidation contract, submit Borrower's Total Debt.
Receive wstETH equivalent to Borrower's Total Debt + Liquidation Reward Rate of Excess Collateral.
Swap wstETH back into R.
[Optional Flash Loan]: Repay Borrower's Total Debt of flash loan.
[Optional Flash Mint]: Repay Borrower's Total Debt * (1+FlashMintFee%) of flash mint.
Redistributions serve as a last line of defense in the highly unlikely event that liquidators fail to liquidate all under-collateralized, risky Positions. They are designed to ensure that losses incurred by an under-collateralized position are fairly distributed among all Positions, reducing the risk of systemic failure. This mechanism maintains user trust and confidence in the protocol, making it a vital part of DeFi lending.
If a borrower's collateralization ratio falls to 100% or below, a Redistributor may initiate a Redistribution process, earning a Redistributor Reward.
The remaining collateral and debt of the affected Position are proportionally split among other Positions based on their collateral amounts, with higher collateral amounts receiving a larger share. After the redistribution, the under-collateralized Position is closed.
The Redistributor's role is to invoke the contract for initiating the redistribution process. Due to the potential for high gas fees, an incentive is provided to the Redistributor.
The Redistributor Reward Rate is a dynamic percentage of the Total Collateral, set according to a pre-defined table.
The mechanisms of liquidations and redistributions are crucial for ensuring solvency and stability in decentralized finance protocols like Raft.
The R stablecoin, designed to always retain a value of 1 USD, relies on these mechanisms to maintain stability and reliability.
By understanding how liquidations and redistributions work with R, users can confidently trade R with minimal slippage or price impact. To learn more about Raft and its features, please visit the official documentation.
Find out more about Raft’s One-Step Leverage.
Jump on board the Raft Discord and get involved in the R-evolution of decentralized finance.
Website: https://www.raft.fi/ Twitter: https://twitter.com/raft_fi Telegram Channel: https://t.me/raft_fi Telegram Group: https://t.me/raft
In the thrilling world of decentralized finance, solvency and stability are the dynamic duo that guarantee user trust and adoption.
Enter Raft, a decentralized lending protocol that allows people to take out stablecoin loans against capital-efficient collateral.
Raft’s first stablecoin is called R and is backed exclusively by stETH (Lido Staked Ether). With its eyes set on becoming the number one stablecoin within the decentralized ecosystem, R relies on the powerful tag team of liquidations and redistributions to safeguard its value and maintain solvency.
Let's embark on a journey to understand how these processes work with R.
Liquidations play a vital role in making sure each 1 R is always backed by at least 1 USD worth of wstETH.
An account becomes eligible for liquidation when a Position's Collateral is between the Minimum Collateralization Ratio and 100% collateralization (i.e., 100% < Position's Collateral < 110%).
The liquidation process is initiated when the Liquidator calls the smart contract to perform the liquidation.
The Liquidator pays off the Borrower's Total Debt, and in return, receives the equivalent amount of Matching Collateral and the additional Liquidator Reward, which is based on a pre-defined formula.
Positions below the Minimum Collateral Ratio can be liquidated through the following methods, earning the Liquidator collateral and liquidation rewards:
[Optional Flash Loan]: Borrow Borrower's Total Debt from a Liquidity Pool (such as Balancer).
[Optional Flash Mint]: Flash mint Borrower's Total Debt directly from RAFT.
Call the Liquidation contract, submit Borrower's Total Debt.
Receive wstETH equivalent to Borrower's Total Debt + Liquidation Reward Rate of Excess Collateral.
Swap wstETH back into R.
[Optional Flash Loan]: Repay Borrower's Total Debt of flash loan.
[Optional Flash Mint]: Repay Borrower's Total Debt * (1+FlashMintFee%) of flash mint.
Redistributions serve as a last line of defense in the highly unlikely event that liquidators fail to liquidate all under-collateralized, risky Positions. They are designed to ensure that losses incurred by an under-collateralized position are fairly distributed among all Positions, reducing the risk of systemic failure. This mechanism maintains user trust and confidence in the protocol, making it a vital part of DeFi lending.
If a borrower's collateralization ratio falls to 100% or below, a Redistributor may initiate a Redistribution process, earning a Redistributor Reward.
The remaining collateral and debt of the affected Position are proportionally split among other Positions based on their collateral amounts, with higher collateral amounts receiving a larger share. After the redistribution, the under-collateralized Position is closed.
The Redistributor's role is to invoke the contract for initiating the redistribution process. Due to the potential for high gas fees, an incentive is provided to the Redistributor.
The Redistributor Reward Rate is a dynamic percentage of the Total Collateral, set according to a pre-defined table.
The mechanisms of liquidations and redistributions are crucial for ensuring solvency and stability in decentralized finance protocols like Raft.
The R stablecoin, designed to always retain a value of 1 USD, relies on these mechanisms to maintain stability and reliability.
By understanding how liquidations and redistributions work with R, users can confidently trade R with minimal slippage or price impact. To learn more about Raft and its features, please visit the official documentation.
Find out more about Raft’s One-Step Leverage.
Jump on board the Raft Discord and get involved in the R-evolution of decentralized finance.
Website: https://www.raft.fi/ Twitter: https://twitter.com/raft_fi Telegram Channel: https://t.me/raft_fi Telegram Group: https://t.me/raft
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