Edel Finance's tokenized stock exploit.

On July 1, an attacker drained about $403,000 from Edel Finance, a platform for trading tokenized stocks, by inflating collateral to 78 times its real value.

The collateral was wGOOGLx, a wrapped version of a tokenized Google share. A wrapped token is an asset repackaged to work inside one protocol, meant to track the original one for one. The attacker manipulated the exchange rate between the wrapped token and the share, so wGOOGLx counted as far more collateral than it held, then borrowed real assets against it.

The price feed was accurate. Chainlink oracles, the standard service that reports real-world prices on-chain, showed Google near $357 the whole time. The break was in the wrapping step that turns the share into collateral, one layer below the price the protocol trusted.

Tokenized stocks add that layer between an asset and its price. Each wrapping step is another place a value can be forged, even when the underlying quote is right.