Tectonic says $9.19M remains missing after $120.4M lending exploit

Cronos-based lending protocol Tectonic has published a post-mortem on its recent exploit, according to ChainThink. The report said that on Aug. 30 the attacker manipulated the price of Tectonic's governance token, TONIC, using the inflated valuation to post collateral and borrow assets worth $120.4 million across multiple markets in a single transaction. Cronos later paused the network and reverted the chain state. Before the pause, the attacker bridged out about $9.19 million, which remains unrecovered. Tectonic attributed the incident to a design flaw that allowed TONIC to be borrowed and immediately redeposited as collateral within the same transaction. The collateral was valued at spot price with a 20% loan-to-value ratio, and the system lacked both a market-depth-based cap and checks for sudden price spikes. The team said it will phase out low-liquidity tokens that are difficult to price as eligible collateral and introduce per-market borrowing limits. Further details will be released after the implementation plan is finalized. Tectonic added that it is working with forensic firms, law enforcement, stablecoin issuers, exchanges, and cross-chain bridges to pursue fund recovery.