Observers were quick to notice that the "hack" was made possible by the addition of a fake collateral token, which was then manipulated to liquidate the protocol's users, suggesting the "hack" was likely an inside job.
On December 26, Defrost claimed that the "hacker" had miraculously returned the money. The announcement didn't seem to convince the project's users, who left comments like, "It was never hacked. You tried to rug your users".
Defrost Finance's team had previously run a project called FinNexus, which also suffered a "hack" in May 2021 that was widely believed to have been a rug pull.