Balance Coin goes to zero after oracle exploit guts 42DAO

Balance Coin ($BLC), the dollar-pegged stablecoin issued by BNB Chain DeFi protocol 42DAO (@42dao_official), collapsed from its $1 peg to around $0.0013 after an attacker exploited a flaw in the protocol's oracle system, draining roughly $912,000. At the time of checking, CoinMarketCap showed $BLC trading near $0.00247, down 99.75% over 24 hours.

How the Attack Worked

The attacker liquidated multiple $BTCB-collateralized vaults in a single transaction at the manipulated price, profiting from the gap between the false valuation and the collateral's real worth. SlowMist described it as a single-transaction combo exploiting missing price protection and liquidation delay in a Maker-style system. The attacker exploited the lack of price protection and liquidation delays in the Maker-style system, which allowed them to use an abnormally low $BTCB oracle price to liquidate positions that would not have been liquidated under normal conditions.

The component names in SlowMist's analysis reveal that 42DAO built its protocol as a fork of MakerDAO's collateralized debt position system. SlowMist identified the core failure as oracle price manipulation combined with a complete absence of liquidation delay. Those two missing safeguards, price validation against a reliable range and a time buffer before liquidations execute, are considered baseline protections in DeFi protocol design.

According to security researcher TenArmor, the first transaction minted approximately 4.5 million $BLC tokens from a null address and moved them to PancakeSwap V2, where they were exchanged for Binance USDT and $BTCB. A second transaction followed roughly two hours later, minting an additional 5,900 $BLC tokens and draining further liquidity. The unauthorized minting sharply increased the supply of $BLC tokens, flooding decentralized exchange liquidity pools and putting severe selling pressure on the stablecoin.

No Response from 42DAO

42DAO had not issued a public statement on the incident or a recovery plan at the time of writing. The incident fits a trend that has defined DeFi exploits through 2026, with attacks moving away from simple contract bugs and toward the oracles, governance rules, and infrastructure surrounding the code. Recent months saw the Ostium Perpetuals vault drained through manipulated oracle reports and the Bonzo lending protocol exploited via a third-party oracle feeding a forged price. The common thread is that the vulnerable layer is increasingly the one that determines what a protocol believes an asset is worth.

Crypto Times: 42DAO's BLC Stablecoin Depegs to Near Zero After $912K Oracle Exploit | CoinTelegraph: Balance Coin Crashes 99% After Reported $915K Exploit | Tron Weekly: Balance Coin Drops 99% As Reported $915K 42DAO Exploit Drains Liquidity