Tydro Pauses Markets After Oracle Provider Suffers State-Level Attack, Plans Chainlink Migration

According to ChainCatcher, on May 4, Tydro's oracle provider suffered an attack with characteristics similar to state-level attackers, prompting the Kraken-backed Ink Layer 2 lending protocol to pause all markets. Chaos Labs, the risk management firm, notified Tydro of the breach and recommended immediate suspension. Tydro confirmed no abnormal prices were pushed to its markets and user positions remained unaffected.

After approximately 48 hours, Chaos Labs confirmed the compromised keys had been rotated and operations were technically recoverable. However, Tydro chose to maintain the pause until completing its migration to Chainlink as a secondary oracle. Upon migration completion, a 48-hour timelock will be triggered, followed by a four-hour grace period allowing borrowers with health factors below 1 to repay or add collateral without liquidation. Tydro, an Aave v3 deployment, manages over $700 million in total market size.