YAM Finance: Inverse Finance $240K Loss Tied to LlamaLend sDOLA Mechanism, Not Contract Vulnerability

YAM Finance said on X that the estimated $240,000 loss from a suspected attack on Inverse Finance, flagged by BlockSec, stemmed from the LlamaLend mechanism involving sDOLA rather than a smart contract vulnerability. The attacker executed a "donation attack" on LlamaLend that shifted the sDOLA price from approximately 1.188 sDOLA = 1 DOLA to roughly 1.358 sDOLA = 1 DOLA, then liquidated nearly all user positions that borrowed crvUSD using sDOLA as collateral. The reason collateral appreciation triggered liquidations remains unclear, while users holding only sDOLA without leverage saw paper gains of around 14%, and DOLA is trading at roughly a 1% discount to its peg on secondary markets.