Compound CETH Market Blocked By Update — 7-Day Vote Delay To Restore Access

In a recent governance proposal to update its price feeds, the decentralized lending platform Compound was troubled by a programming fault.

The programming error has "temporarily blocked" the Compound ETH (cETH) market, causing cETH transactions to reverse, however Compound Labs has said that "funds are not immediately at risk" despite the fact that the front end is not functioning.

Compound Labs revealed on August 31 that the source of the code fault was Proposal 117: Compound Oracle Upgrade v3, which was implemented a few hours earlier to update the oracle contracts on the Compound protocol to a new version that uses Uniswap V3 rather than V2 for price feeds.

In reaction to the temporary freezing of the cETH market, Compound Labs stated that it intended to revert to the old price feed through Proposal 119: Oracle Update.

The new proposal was created less than one hour following the execution of Proposal 117, but it must now undergo a seven-day governance process before going into force.

According to an update from OpenZeppelin's Security Solutions Architect Michael Lewellen, the code flaw originated from the "getUnderlyingPrice" function, which failed to update the price of cETH tokens, resulting in the return of empty bytes and a call reversal.

Additionally, Lewellen confirmed that no money are at risk:

According to a local news report, the South Korean central bank has stated that initial coin offerings (ICOs) will be permitted under the Digital Assets Framework Act.

"The most pressing issue at present is a temporary denial of service on the cETH market, which will be rectified by the new governance proposal.

No funds are currently at risk. The remaining cToken markets on Compound V2 and V3 are operational."

Lewellen stated, "any customers that deposited ETH and acquired cETH for initiating borrow positions must be informed that they may be liquidated instantaneously if the price of ETH has decreased sufficiently by the time the fix proposal is implemented."

However, Robert Leshner, the CEO of Compound Labs, stressed that users can still repay any debt and provide collateral to prevent liquidation.

Compound Labs claimed the oracle contract was audited by three distinct smart contract auditing organizations, with OpenZeppelin and ChainSecurity among the most recent businesses to audit Compound's smart contracts.

All 696,665 votes from 245 distinct wallet addresses were in support of the price feed improvement, indicating that Proposal 117 did not appear to be contentious.

Polychain Capital cast the most number of votes (306,146) in favor of the proposition.

Compound is the third largest decentralized lending network, according to DeFi Llama, with a total locked value of $2.67 billion (TVL).

The announcement has not yet changed the price of the COMP coin, which is now $48.27.