Blockchain protocol Term Labs has lost an estimated $8.5 million after suffering a governance exploit that allowed hackers to gain control of the protocol’s vaults and drain funds.

According to blockchain security firm PeckShieldAlert, the attackers first built up enough voting power to take full control of four of the five USDC vaults and approximately 91% of the protocol’s Ethereum Meta vaults.

With this much voting power, the attackers were able to pass proposals, eventually enabling them to drain approximately 2,843 ETH, worth $6.87 million, and an additional $1.68 million in funds.

In response to the exploit, Term Labs acknowledged the incident. Although the team said it would share more details as the incident is being investigated, it advised all of its customers, as a safety precaution, to revoke all approval contracts associated with the protocol.

Governance exploits, which often involve attackers gaining enough voting power to execute malicious proposals, have become increasingly prevalent in recent times.

Prior to the Term Labs exploit, BonkDAO, a decentralized autonomous organization, also lost an estimated $20 million to $21 million from its treasury after attackers spent roughly $4.4 million buying enough BONK tokens to gain control of the votes and pass malicious proposals.

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Term Labs Loses $8.5 Million in Governance Exploit