New Free DAO

New Free DAO operates as a decentralized autonomous organization on the Binance Smart Chain blockchain. The organisation provides a rewards mechanism to its participants through a smart contract. Its native utility token is designated NFD, which is used within the reward system. The rewards contract that powered the incentive program was not subject to public verification at the time of the incident. These characteristics place New Free DAO within the broader DeFi sector that relies on programmable contracts for token-based rewards. No further quantitative data regarding the size, user base, or transaction volume of the DAO is disclosed in the available sources.

On September 8, 2022, an attacker executed a flash loan exploit targeting the unverified rewards contract of New Free DAO. By deploying a malicious contract and manipulating membership privileges, the assailant illicitly minted 343 million NFD tokens. The tokens were subsequently swapped for other cryptocurrencies, resulting in the extraction of approximately $1.3 million in value. The sudden influx of NFD caused the token’s market price to decline by more than ninety‑nine percent. A portion of the stolen proceeds, amounting to $111,544, was routed through Tornado Cash for obfuscation, while the majority remained in the attacker’s wallet. The perpetrator had previously been linked to a separate $297,000 flash loan attack, underscoring a pattern of exploiting unaudited DeFi protocols, and the event serves as a case study of the risks inherent in unverified smart contracts.