An attacker drained approximately $1 million in USDC from a lending vault built on Avalanche on Tuesday evening, according to blockchain security firm Blockaid. The exploit was carried out using a flash loan, a type of uncollateralized loan that is borrowed and repaid within a single transaction. The attacker used the flash loan to mint inflated tranche shares, then redeemed those shares for the vault's USDC across roughly two transactions.
Blockaid flagged the attack in a post on X at 9:07 p.m. ET, describing the exploit as "ongoing" and noting that the loss figure was a running total. The firm said the vault was "related to" Valinor Digital and Fence, without specifying which one operates it. Neither company had commented at the time of writing. It remains unclear whether the vault has been paused or whether any funds can be recovered, and the number of affected depositors is currently unknown.
The incident recalls a February 2023 exploit on Avalanche, when the Platypus protocol lost about $8.5 million in a flash-loan attack. While the new drain is smaller in comparison, it adds another security concern to Avalanche sentiment as the token's chart already looks fragile.
AVAX technical outlook: Avalanche traded near $8.86, down about 1% on the day, with a weekly loss near 9% and a monthly decline of roughly 19%. The token has slipped below both its 50-day moving average (near $9.42) and its 200-day moving average (near $9.12), with each line now acting as resistance. RSI reads 36, indicating weak momentum but not yet oversold. The nearest support floor sits near $8.26, and a break below that level could open the way toward $7.04. Bulls would need to reclaim the 200-day line and then push through resistance near $9.76 to reverse the downtrend.
Chainlink technical outlook: LINK traded near $11.55, flat on the day, with a weekly loss of about 6% and a monthly decline of roughly 18%. Unlike AVAX, LINK still holds above its 200-day moving average near $11.00, which acts as a long-term floor. The 50-day average near $12.22 now caps rallies. RSI reads 39, similar to AVAX in its weak-but-not-oversold state. Key support sits near $10.91, and a daily close below that level would expose the next floor around $9.75. Resistance waits near $12.71, with a higher ceiling around $13.60.
Both charts still lean bearish, with sellers in control of momentum. LINK appears the sturdier of the two because its long-term average still holds underneath, while AVAX has no such cushion left. The next few daily closes should settle the direction for both tokens.
