Odaily Planet Daily reports that Venus Protocol issued a statement regarding the THE market incident, clarifying that it was not a flash loan attack, but rather caused by an attacker exploiting a supply cap execution vulnerability in the protocol's old code. The team stated that the attacker accumulated THE tokens over approximately nine months, gradually establishing a dominant supply position on Venus. The announcement indicates that the attacker bypassed the normal deposit process by directly transferring THE tokens into the protocol contract, thereby exceeding the 14.5 million THE supply cap and manipulating DEX prices by exploiting the low on-chain liquidity. Once the external price was gradually reflected by the TWAP oracle, the attacker used the inflated collateral value to repeatedly borrow assets (such as CAKE and BNB), then bought more THE to further drive up the price, continuously transferring THE into the vTHE market to increase the collateral value. This cycle pushed the price from approximately $0.27 to approximately $0.53, ultimately leaving bad debt in the protocol after the position was liquidated. Venus stated that it has currently suspended the THE market, reduced its collateral factor to 0, and suspended withdrawals. Meanwhile, as a precautionary measure, the collateral factor for eight markets—BCH, LTC, AAVE, POL, FIL, TWT, UNI, and LISUSD—has been reduced to 0. The team and security partners are continuing their investigation and will release a full post-incident analysis report later.