Sonne Finance: This attack was a donation attack. We are investigating the attacker and have suspended the market.

Sonne Finance released an attack analysis report. This was a donation attack. Sonne had avoided this problem in the past by adding a collateral factor of 0% to the market, adding collateral and then destroying it, and only then increasing c-factors according to the proposal. Sonne recently passed a proposal to add the VELO market to Sonne. This transaction was arranged on a multi-signature wallet, and c-factors were arranged to be executed within 2 days due to the time lock. When the 2-day time lock for creating the market ended, the attacker executed 4 of the transactions and then executed the transaction to add c-factors to the market. The attacker was able to use the protocol to obtain approximately $20 million in funds through a known donation attack. Seal contributors quickly noticed this issue and reserved approximately $6.5 million by adding VELO worth approximately $100 to the market. Sonne is investigating the attacker and has suspended the market to mitigate further losses. Sonne is prepared to offer a bounty to the attacker and promises not to pursue the issue further if the attacker returns the funds.