Term Finance loses estimated $8.5M in vault governance exploit
Term Finance lost an estimated $8.5 million after an attacker gained governance control of its strategy vaults and drained assets. PeckShield said about 2,843 ETH and 1.68 million USDC were taken; CertiK gave a similar total estimate. The attack removed roughly 68% of the $12.45 million held in the vault product, including nearly all Ethereum deposits. Term Labs shut down all Term Meta Vaults, revoked their DAO governance roles, and left withdrawals open while blocking new deposits. It said the core Term protocol and direct lending markets appeared unaffected, though the full scope was still being checked. Onchain observers said the attacker likely bought a majority of a thinly held governance token and used proposals to seize control. The vaults used Yearn V3 infrastructure, but Yearn said the issue involved a custom governance wrapper, not standard Yearn vaults.
