Compound Finance had rolled out a new upgrade to its protocol, but the update was accompanied by a bug that caused some users to claim unusual amounts of the native cryptocurrency COMP.
Compound Finance struggles with an unexpected bug
The team behind the Compound protocol tweeted on Wednesday evening:” Unusual activity has been reported regarding the distribution of COMP following the execution of Proposal 062″
The purpose of Proposal 062, which went live a few hours earlier, was to split the distribution of COMP to liquidity providers and borrowers based on governance rates, rather than the previous 50/50 sharing model. The new upgrade is also intended to fix minor bugs.
But a new bug in the updated version of the Comptroller Contract has allowed some users to claim 168,000 COMP tokens worth around $50 million mistakenly. Robert Lesher , the founder of Compound Labs, said that the worst-case impact is limited to 280,000 COMP worth around $84 million.
Changes to the protocol require a 7-day governance process
“There are no admin controls or community tools to disable the COMP distribution,” Leshner said. “Any changes to the protocol require a 7-day governance process to make their way into production.” While no supplied or borrowed funds are currently at risk, Compound Labs and community members are investigating inconsistencies in the protocol’s native token distribution.
The COMP price has tanked 10% since Compound Finance revealed the bug. The selling pressure caused the token to fall to a low of $279.50.