Cosmos’ stablecoin protocol hacked within hours of this new announcement

• Harbor protocol disclosed that it was hacked but what will the impact on Cosmos and ATOM be?
• ATOM flashed signs that it might be developing a wave of accumulation.

The Harbor protocol, a cross-chain stablecoin protocol that operates on the Cosmos network just announced that it suffered an exploit. The DeFi protocol issued its official statement on Twitter.

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According to the statement, the, Harbor managed to identify the wallet that the attackers used. They also found that the attackers managed to drain some funds from multiple asset vaults.

Harbor did not disclose the size of the losses incurred, but noted that the figures would be highlighted in its official incident report. The stablecoin protocol also added that it was engaged in efforts to secure control over the situation.

1/ Dear Harbor Community,

It has come to our notice that Harbor protocol has been exploited over the past few hours, resulting in a drain on a portion of the funds sitting in the stable-mint and stOSMO, LUNA and WMATIC vaults.

— Harbor Protocol (@Harbor_Protocol) August 19, 2023

The exploit was announced on the same day that Cosmos’ Interchain Foundation announced Brian Crain as its new president. Brian happens to be the CEO of ChorusOne, a company that offers decentralized institutional staking services.

1/ We are proud to announce the new President of the Interchain Foundation: Brian Crain@crainbf will combine his experience and knowledge of the blockchain industry to increase the efficiency and impact of ICF’s contributions to the vibrant interchain ecosystem. pic.twitter.com/NoK99IbdSn

— Interchain Foundation (@interchain_io) August 18, 2023

Brian’s experience as ChorusOne’s CEO means he has vast experience in dealing with multiple staking networks. His appointment as the new president of Interchain Foundation reflects Interchain’s next step in the grand scheme of things. Interchain is expanding link to more blockchain networks especially those with a Proof of stake consensus mechanism.

Should investors expect an impact on ATOM’s price action?

The appointment of a new Interchain’s new president could have an impact in terms of long-term growth. As such, it may not have an immediate impact. On the other hand, negative news tends to have a bigger impact and reports of the exploit fit the bill. The market may react depending on the amount of funds stolen, especially if it is enough to trigger FUD and heavy liquidity outflows.

ATOM may have already exhausted its bearish potential during the recent crash. Its $7.61 press time price represents an attempt to bounce off from its recent lows.

Source: TradingView

ATOM has been showing signs of an extended pivot. For example, its RSI is attempting to bounce from oversold zone and the MFI indicates a shift in favor of accumulation. In addition, its on-chain volume reached a monthly peak on Friday, suggesting that a wave of accumulation might have curtailed the downside.

Source: Santiment

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The demand levels have not been strong enough to support a strong pivot despite the volume surge. This reflects the fact that most investors are still on a bearish sentiment. The weighted sentiment is yet to recover from its lower monthly range.

Nevertheless, Cosmos registered a surge in social dominance which could have something to do with the post-exploit reactions.

Source: Santiment