Enso Finance’s month-long vampire attack on six competing DeFi protocols could drain roughly $1 billion

Enso Finance’s month-long vampire attack on six competing DeFi protocols could drain roughly $1 billion
Enso Finance’s month-long vampire attack on six competing DeFi protocols could drain roughly $1 billion

Metaverse-based social trading platform, Enso Finance has announced a month-long vampire attack that could drain nearly $1 billion from six competitors’ DeFi protocols, which could be considered a controversial bootstrapping strategy.

The company says that users who migrate their liquidity and participate in the vampire attack over the next month will receive reimbursements of gas fees and native tokens by Enso Finance.

During that time, users who stake their migrated tokens on Enso for three weeks, at which point Enso burns the original tokens and issues wrapped versions of the index’s underlying assets.

As per the firm, the feature set and functionality would ensure that customers stick around once they have made the transition.

Vampire attacks occur when a platform offers higher incentives to entice users and liquidity to move away from a competitive platform. In September 2020, Uniswap lost $1.5 billion to SushiSwap as a result of a vampire attack.

Connor Howe, the cofounder of Enso, told Decrypt, “I actually think it’s very positive. Because it’s what traditional players do. [UK mobile service providers] Swisscom or BT incentivize customers to change plans all the time.”

He adds, “Sure, it might sound bad, it might sound a bit aggressive, but sometimes you have to take a risk. We chose the word ‘vampire attack’ instead of liquidity migration because it’s more powerful and people understand what it is.”

Enso’s platform is targeting Index Coop, dHedge, PowerPool, TokenSets, PieDAO, and Indexed Finance, which is an account for more than $500 million of total value locked (TVL).

The firm allows individuals, communities, and decentralized autonomous organizations (DAOs) to develop trading strategies and yield farm strategies on the platform.

Orgianlly Published at CryptoBusinessworld.com and Source Link

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