Hundred Finance Exchange-Rate Manipulation

On April 15, 2023, the multi-chain lending protocol Hundred Finance was exploited on its Optimism deployment for approximately $7 million. The vulnerability was a precision/rounding bug in the Compound v2 exchange-rate calculation — the same forked code that would later cost Sonne Finance $20M in 2024.

What happened

Hundred Finance was a Compound v2 fork. Its lending markets calculated the exchange rate between a deposit token (e.g. WBTC) and its corresponding cToken (hWBTC) using a formula that depended on:

• totalCash — how much underlying the contract holds
• totalBorrows and totalReserves — outstanding loans and reserve allocations
• totalSupply — total cTokens minted

The attack used a flash loan and an empty-market donation pattern:

1. The attacker found a Hundred market with negligible supply of cTokens.
2. Using a flash loan, they donated WBTC directly to the contract (raw transfer, no mint), inflating totalCash without changing totalSupply.
3. The exchange rate (totalCash / totalSupply) skyrocketed — a single cToken now represented a vast amount of underlying.
4. They redeemed their tiny pre-existing cToken position, claiming almost the entire WBTC pool as the redemption.
5. The protocol's redemption function also had a rounding error that prevented the math from blocking the absurd ratio.
6. Repeating across vulnerable markets drained roughly $7M before Hundred paused.

Aftermath

• Hundred paused Optimism markets and announced a post-mortem.
• Funds were laundered through cross-chain bridges and mixers. In April 2024 the attacker began moving the stolen assets again after a year of dormancy.
• Hundred had previously been exploited in March 2022 (a reentrancy attack on the Gnosis Chain deployment, jointly with Agave, for $11M) and never fully recovered between incidents.

Why it matters

Hundred Finance was an early warning of what later played out at scale: Compound v2 forks deployed on alternative L1s and L2s tend to inherit the security model of vanilla Compound v2, including its known-but-easy-to-miss footguns. The donation/precision pattern has since accounted for incidents at Sonne, Midas, Onyx and others — every time, the same shape, every time, the same root cause.