A significant security incident has forced Loopscale, a decentralized finance (DeFi) protocol operating on the Solana blockchain, to halt its lending operations. The breach resulted in substantial financial losses, compelling the platform to reassess its security measures and operational status.
Details of the Security Breach
The exploit occurred on April 26th when malicious actors managed to circumvent the platform’s safeguards. According to co-founder Mary Guneratne, the attackers executed a series of undercollateralized loans, successfully extracting approximately $5.7 million in USDC and 1,200 SOL. The total estimated loss stands at around $5.8 million.
Platform Response and Impact
In the aftermath of the attack, Loopscale took immediate steps. While core lending and withdrawal functions remain suspended pending a full investigation, the platform was partially reopened. This allows users limited functionality, specifically enabling them to repay existing loans, add collateral to their positions, and close established loops. Ms. Guneratne clarified that the security breach specifically impacted the platform’s USDC and SOL vaults. This loss represents roughly 12% of Loopscale’s total value locked (TVL) prior to the incident.
This event contributes to a concerning trend of high-value exploits within the cryptocurrency space during 2025. Blockchain security firm PeckShield highlighted that over $1.6 billion was stolen in the first quarter alone, largely attributed to a major breach involving the Bybit exchange, suspected to be linked to the North Korean Lazarus Group.
Loopscale’s Operational Model and Trajectory
Launched publicly on April 10th following extensive beta testing, Loopscale introduced a distinct approach to DeFi lending. Unlike platforms such as Aave that rely on pooled liquidity, Loopscale utilized an order book model to directly match borrowers and lenders. This structure supported specialized markets, including structured credit offerings and undercollateralized loan facilities.
Despite this setback, Loopscale had shown promising early growth, attracting a significant user base and accumulating approximately $40 million in TVL. Its USDC and SOL lending vaults were particularly favored, offering competitive yields. The platform aimed to foster a diverse lending environment by supporting a variety of asset pairs.
Maxwell Reed is the first editor of Cryptovista360. He loves technology and finance, which led him to crypto. With a background in computer science and journalism, he simplifies digital currency complexities with storytelling and humor. Maxwell began following crypto early, staying updated with blockchain trends. He enjoys coffee, exploring tech, and discussing finance’s future. His motto: “Stay curious and keep learning.” Enjoy the journey with us!