{"slug": "moonwell-slashes-borrow-caps-to-1-wei-after-mamo-price-manipulation-exploit-on", "title": "Moonwell slashes borrow caps to 1 wei after MAMO price manipulation exploit on Base", "summary": "Moonwell, a decentralized lending protocol on Base, slashed the borrow cap in its MAMO Core Market to 1 wei, effectively freezing borrowing after a price manipulation attack on the MAMO token siphoned an estimated $10 million in assets, including over $4 million in cbBTC. The attacker inflated MAMO's price, deposited it as collateral, and borrowed high-value assets, exploiting the token's low liquidity and shallow order books. Moonwell also tightened supply caps on MAMO and WELL tokens while conducting a review of the exploit's impact.", "body_md": "Photo: Pachon in Motion / Pexels\n\n# Moonwell slashes borrow caps to 1 wei after MAMO price manipulation exploit on Base\n\nThe decentralized lending protocol effectively froze borrowing in its MAMO Core Market after an attacker exploited low-liquidity tokens to siphon an estimated $10M in assets.\n\nMoonwell, the decentralized lending protocol on Base, has reduced the borrow cap in its MAMO Core Market to 1 wei, the smallest possible unit of value on Ethereum-compatible chains. That’s roughly 0.000000000000000001 of a token. In practical terms, borrowing in this market is now frozen.\n\nThe emergency measure came after a price manipulation attack on the MAMO token allowed an adversary to borrow an estimated $10 million in assets against artificially inflated collateral. Supply caps for both MAMO and WELL, Moonwell’s governance token, were also tightened to prevent the situation from getting worse.\n\n## How the exploit worked\n\nMAMO, the utility and governance token for an AI-driven yield optimization tool integrated with Moonwell, fit the bill. With limited trading volume and shallow order books, the token’s price was vulnerable to manipulation. The attacker inflated MAMO’s market price, deposited the tokens as collateral into Moonwell’s lending market, and proceeded to borrow high-value assets against them.\n\nAmong the assets drained: over $4 million worth of cbBTC, Coinbase’s wrapped Bitcoin product on Base.\n\n## Before and after the emergency response\n\nPrior to the exploit, the MAMO market operated with relatively standard parameters. The borrow cap sat at 3 million tokens, with a supply cap of 20 million. Collateral factor was set at 50%, meaning borrowers could take out loans worth up to half the value of their deposited MAMO. The reserve factor stood at 30%.\n\nThe new borrow cap of 1 wei effectively reduces borrowing capacity to zero in any meaningful sense. The supply cap restrictions on both MAMO and WELL add another layer of defense, preventing anyone from depositing more of these tokens into the protocol while the damage is assessed.\n\nMoonwell is now conducting a thorough review of the exploit’s impact, a process that will likely determine whether and how the MAMO market reopens, and what safeguards would need to be in place before it does.\n\n## The oracle problem, again\n\nThis attack highlights a vulnerability that has plagued DeFi lending protocols since the sector’s earliest days: oracle risk. Lending protocols rely on price feeds to determine the value of collateral. When those price feeds can be manipulated, either through direct oracle attacks or by manipulating the underlying market that oracles reference, the entire system breaks down.\n\nFor large-cap tokens like ETH or BTC, manipulating the spot price enough to fool an oracle is prohibitively expensive. For a token like MAMO, with a fraction of that trading volume, the cost of manipulation drops dramatically.\n\n## What this means for DeFi lending\n\nThe immediate fallout is straightforward: Moonwell users with exposure to the MAMO market are in limbo. Borrowers can’t take new positions. Suppliers may find their assets effectively locked until the protocol completes its review and decides on next steps.\n\n**Disclosure:** This article was edited by Editorial Team. For more information on how we create and review content, see our\n\n[Editorial Policy](https://cryptobriefing.com/editorial-policy/).", "url": "https://wpnews.pro/news/moonwell-slashes-borrow-caps-to-1-wei-after-mamo-price-manipulation-exploit-on", "canonical_source": "https://cryptobriefing.com/moonwell-mamo-borrow-cap-exploit/", "published_at": "2026-08-27 11:35:28+00:00", "updated_at": "2026-08-27 11:49:56.495901+00:00", "lang": "en", "topics": ["artificial-intelligence", "ai-products"], "entities": ["Moonwell", "Base", "MAMO", "WELL", "cbBTC", "Coinbase"], "alternates": {"html": "https://wpnews.pro/news/moonwell-slashes-borrow-caps-to-1-wei-after-mamo-price-manipulation-exploit-on", "markdown": "https://wpnews.pro/news/moonwell-slashes-borrow-caps-to-1-wei-after-mamo-price-manipulation-exploit-on.md", "text": "https://wpnews.pro/news/moonwell-slashes-borrow-caps-to-1-wei-after-mamo-price-manipulation-exploit-on.txt", "jsonld": "https://wpnews.pro/news/moonwell-slashes-borrow-caps-to-1-wei-after-mamo-price-manipulation-exploit-on.jsonld"}}