Blockchain Sleuth Warns About Unrevealed ‘Critical Flaws’ in Ethena

Blockchain Sleuth Raises Concerns About Hidden Vulnerabilities in Ethena

A blockchain investigator known as Tardfiwhale, who accurately predicted the downfall of Luna and UST, has disclosed the presence of critical flaws in Ethena, a growing blockchain synthetic dollar stablecoin protocol. Tardfiwhale is requesting donations to certain organizations before revealing these alleged flaws, as Ethena does not have a bug bounty program.

Alleged “Critical Flaws” Found in Ethena, According to Investigator

Ethena’s decentralized protocol is under scrutiny by actors in the blockchain industry. Tardfiwhale, a pseudonymous blockchain sleuth, claims to have discovered critical flaws in the underlying system supporting Ethena, which has already issued over $1.5 billion worth of USDE, a synthetic dollar stablecoin.

Since March 15, Tardfiwhale has been warning about these alleged flaws, suggesting that the current operation of the protocol could result in substantial financial losses for its users. Notably, Tardfiwhale accurately predicted the downfall of LUNA and UST in the past and raised concerns about potential bank runs involving the OHM platform.

However, Tardfiwhale is unwilling to reveal the source of these problems without compensation. Once the flaws are exposed and proven to exist, Tardfiwhale asks for donations to be made to third parties. Initially, he requested $500,000 in donations, with half going to Protocol Guild, a group of Ethereum developers. The remaining half would be divided between Zachxbt, another crypto researcher, and the legal defense of Tornado Cash developers facing money laundering charges.

On March 18, Tardfiwhale increased the bounty to $1 million while maintaining the same proportions for the recipients of the donations. This decision was influenced by the involvement of Maker and Mantle, two protocols that plan to invest hundreds of millions in Ethena.

When asked about his reasons for directing these donations to third parties before revealing the identified flaws in Ethena, Tardfiwhale stated:

“This is a chance for me to give back, and after all the pain caused by UST, FTX, Celsius, etc., it would be sad to see another disaster with USDE.”

He emphasized that he would gain no personal benefit from disclosing these flaws and is solely attempting to prevent another catastrophic event within the crypto community.

Ethena is on the verge of airdropping 750 million ENA, its governance token, and has recently announced plans to include bitcoin as a backing asset.

What are your thoughts on Tardfiwhale’s allegations regarding the “critical flaws” in Ethena? Share your opinions in the comments section below.