NORMIE Meme Coin Project Shaken by Flash Loan Attack, Price Drops 93%

NORMIE, the meme coin project of the Base ecosystem, was shaken by a flash loan attack on May 26, when its price dropped by 93% in a short time.

A flash loan attack hit the NORMIE meme coin project on May 26, causing its price to plummet by 93% within a short span of time. This incident highlights the vulnerabilities that continue to plague the Decentralized Finance (DeFi) space, making it challenging for projects to fend off such attacks. Here's a closer look at the events that unfolded…

Meme coin hit by a flash loan attack

The attack was carried out through a series of strategic maneuvers by the attacker, as revealed by blockchain researcher @onchainfudder and confirmed by Chainlinkminimalism. The attacker identified a critical vulnerability in the NORMIE contract, which enabled them to manipulate the buy and sell functions repeatedly after disabling transaction fees. This triggered the contract's built-in mechanism, which was designed to automatically sell tokens exceeding 1% when fees reach a threshold.

The attacker's actions prompted a massive sell-off, which drastically reduced the price of the token. However, the attacker then purchased a substantial quantity of these sold tokens within the same transaction block for practically zero cost. This tactic allowed them to generate a significant profit from the entire operation.

How did the project benefit?

It's noteworthy that while the attack resulted in significant financial losses for NORMIE holders, the project itself also stood to benefit to some degree. The automated token dump, manipulated by the attacker, generated a substantial amount of funds for the project through transaction fees. This raises concerns regarding conflicts of interest and the possibility of the project party being aware of the manipulation beforehand.

The deployer wallet has +500eth at the moment, everything will be used to make this right. https://t.co/K7QZE5bZsLApologies for the delay. We are on it & on chat, active.We still are not sure if this needs to be re-launched or forked. We won't make rushed decisions.Also,…

The NORMIE team acknowledged the attack in an official statement, expressing their regret and apologizing to the community. They reassured users that the distributor still held over 500 ETH in their wallet, which they planned to utilize for compensation and recovery efforts. The project was actively pursuing solutions and was in close communication with key partners to address the situation.

What's next?

The future course of action remains to be fully determined. The NORMIE team has yet to confirm whether a complete redistribution of the project or a fork will be necessary. They also cautioned users against purchasing NORMIE tokens until further notice, highlighting the risk of the attacker manipulating the token supply through further minting or purchasing.

This flash loan attack on NORMIE serves as a stark reminder of the evolving nature of threats in the DeFi realm. As the project undertakes the recovery process, the incident raises questions about its potential impact on the project's security infrastructure and investor confidence. While the NORMIE team navigates this crisis, the broader DeFi community will be watching their solution closely, hoping to glean valuable lessons that can help strengthen the entire ecosystem against future attacks.

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