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- #1publishby system:backfill2026-08-09 12:25:05ZScore: ? → ? (no score change)anchorpending
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{"actor":"system:backfill","investigation_id":"4feace03-6746-48e9-a625-9cd1ac6e6351","kind":"publish","page_slug":"summer-finance-summer-fi-lazy-summer-protocol-flash-loan-exploit-and-shutdown","published_at":"2026-08-09T12:25:05.881Z","sequence_num":1,"snapshot":{"content_type":"investigation","entity_name":"Summer Finance (Summer.fi) — Lazy Summer Protocol Flash Loan Exploit and Shutdown","sections":[{"content":"Summer.fi (formerly Oasis.app, originally OasisDEX, established circa 2016) was a DeFi yield-optimization platform built on Ethereum. The platform began as a front-end interface for the MakerDAO ecosystem and rebranded to Summer.fi in 2023, expanding to support multiple protocols including Morpho, Aave, Ajna, and Spark. The Lazy Summer Protocol was the platform's flagship yield product, featuring automated vaults that rebalanced depositor capital across strategies to maximize risk-adjusted returns. The protocol's governance token, SUMR, conferred voting rights over the Lazy Summer DAO and access to staking rewards and revenue distributions. At the time of the exploit, the protocol's total value locked (TVL) was approximately $22 million.","heading":"Background and Protocol History","severity":"low","sources":[{"credibility":1,"name":"Summer.fi blog — All-in on Lazy Summer Protocol announcement","type":"official","url":"https://blog.summer.fi/summer-fi-goes-all-in-on-lazy-summer-protocol-as-summer-pro-transitions-to-defi-saver/"},{"credibility":1,"name":"CoinDesk — DeFi protocol Summer.fi halts Lazy Summer vaults after $6 million exploit","type":"news_article","url":"https://www.coindesk.com/web3/2026/07/06/defi-protocol-summer-fi-halts-lazy-summer-vaults-after-usd6-million-exploit"}]},{"content":"The root conditions enabling the July 2026 exploit trace to the November 2025 collapse of Stream Finance. A $93 million loss disclosed by an external fund manager caused Stream's xUSD stablecoin to crash approximately 77%, exposing an estimated $285 million in interconnected debt across protocols including Euler, Silo, and Morpho. One casualty of this contagion was the Silo 'Varlamore USDC Growth' vault token, which became severely impaired. However, its on-chain valuation was never marked down to reflect its real economic value, leaving it reporting inflated prices for approximately eight months. Summer.fi's Lazy Summer Protocol had integrated the Silo Varlamore strategy as an Ark (strategy adapter) within its vault architecture. After recognizing the impairment, the protocol attempted to offboard the Ark by zeroing its deposit cap — but crucially, the Ark remained registered in the FleetCommander's active asset set, meaning it continued to influence totalAssets() calculations.","heading":"The Stream Finance Collapse: Precondition for the Exploit (November 2025)","severity":"high","sources":[{"credibility":2,"name":"CryptoTimes — $6M Lazy Summer Exploit Traces Back to November's Stream Finance Collapse","type":"news_article","url":"https://www.cryptotimes.io/2026/07/08/6m-lazy-summer-exploit-traces-back-to-novembers-stream-finance-collapse/"},{"credibility":2,"name":"Verichains — Lazy Summer Hack Analysis: Stale-Asset Donation and ERC-4626 Share-Price Manipulation","type":"research","url":"https://blog.verichains.io/p/lazy-summer-hack-analysis-stale-asset"},{"credibility":1,"name":"Summer.fi — Lazy Summer USDC Vault Exploit Post-Mortem","type":"official","url":"https://blog.summer.fi/lazy-summer-usdc-vault-exploit-post-mortem-what-happened-and-what-comes-next/"}]},{"content":"The exploit was executed in a single atomic transaction on July 6, 2026 at approximately 05:17 AM UTC. The core vulnerability involved an ERC-4626 share-price manipulation via stale-asset donation. The attacker exploited the vault pricing formula — share price = totalAssets() / totalSupply() — by transferring overvalued Silo Varlamore tokens directly into the capped-but-still-active Ark. Because the Ark was excluded from new deposits but not from totalAssets() accounting, the donation inflated the Lower Risk vault's reported share price by approximately 9.5% (from 1.0665 to 1.1677 USDC per share) without adding any real withdrawable liquidity. The attacker then redeemed shares at the artificially inflated price, extracting genuine liquid assets belonging to other depositors. The specific attack sequence: (1) Borrowed 65.4 million USDC and 1 million USDT via Morpho Blue flash loans with no fees; (2) Deposited then withdrew approximately 398,000 USDC from the Higher Risk vault, leaving capital in the buffer; (3) Deposited 64.83 million USDC into the Lower Risk vault, donated Silo Varlamore tokens to the capped Ark to inflate NAV, then redeemed 70.96 million USDC; (4) Applied a similar NAV inflation to the Higher Risk vault using previously-minted Term shares, then redeemed 29.92 million USDC from the buffer; (5) Repaid flash loans and transferred approximately 6.04 million DAI to a beneficiary address. The protocol's own post-mortem characterized the root cause as an operational failure — incomplete offboarding of an impaired strategy — rather than a fundamental flaw in the smart contract code itself. The attacker's address is 0x7BF716167B48CF527725722C6d79494b45B3BDCa.","heading":"Attack Mechanics and Technical Vulnerability","severity":"critical","sources":[{"credibility":1,"name":"Summer.fi — Lazy Summer USDC Vault Exploit Post-Mortem","type":"official","url":"https://blog.summer.fi/lazy-summer-usdc-vault-exploit-post-mortem-what-happened-and-what-comes-next/"},{"credibility":2,"name":"Verichains — Lazy Summer Hack Analysis: Stale-Asset Donation and ERC-4626 Share-Price Manipulation","type":"research","url":"https://blog.verichains.io/p/lazy-summer-hack-analysis-stale-asset"},{"credibility":2,"name":"Bitcoin.com News — Summer Finance Pauses Vaults After $65.4M Flash Loan Attack","type":"news_article","url":"https://news.bitcoin.com/summer-finance-pauses-vaults-after-65-4m-flash-loan-attack-triggers-6m-loss/"}]},{"content":"Evidence from on-chain analysis indicates the attack was premeditated rather than opportunistic. Multiple attacker-controlled wallets were funded beginning approximately April 6, 2026 — roughly three months before execution — and used to systematically accumulate the stale Silo Varlamore tokens needed to inflate vault NAV. All wallets were funded via the same origination path, according to post-mortem analysis by security firm Verichains. Following the exploit, the attacker converted the approximately 6.017 million DAI proceeds into ETH and began routing funds through Tornado Cash, the sanctioned cryptocurrency mixing service. By July 9, 2026, approximately $1.35 million in DAI had been converted to ETH and deposited into Tornado Cash in batches of 10 ETH or larger. The use of the mixer substantially complicated on-chain tracing and fund recovery efforts.","heading":"Premeditation and Fund Laundering","severity":"critical","sources":[{"credibility":2,"name":"The Defiant — Summer.fi Hacker Moves $1.35M Into Tornado Cash","type":"news_article","url":"https://thedefiant.io/news/hacks/summer-fi-hacker-moves-1-35m-into-tornado-cash"},{"credibility":2,"name":"Crypto Briefing — Summer.fi hacker launders $1M through Tornado Cash after $6M exploit","type":"news_article","url":"https://cryptobriefing.com/summer-fi-hacker-launders-tornado-cash/"},{"credibility":2,"name":"Verichains — Lazy Summer Hack Analysis: Stale-Asset Donation and ERC-4626 Share-Price Manipulation","type":"research","url":"https://blog.verichains.io/p/lazy-summer-hack-analysis-stale-asset"}]},{"content":"Blockaid flagged the attack at approximately 05:36 AM UTC, roughly 19 minutes after execution. At 06:42 AM UTC, deposit caps were set to zero on affected vaults. By 10:25 AM UTC, the Guardian multisig — an 8-of-6 multisig with constrained authority limited to pause and deposit cap functions — paused all Lazy Summer Protocol vaults across Ethereum, Base, Arbitrum, and Sonic. The Summer.fi Foundation subsequently swept the donated Silo tokens from the affected vault to stop ongoing NAV distortion. Security firms Blockaid, CertiK, PeckShield, and Cyvers coordinated on analysis. The team engaged SEAL 911 for fund tracing and contacted centralized exchanges regarding the attacker's known addresses. The guardian multisig notably lacked authority to move user funds; its powers were confined to pausing and capping operations. No funds were recovered through these emergency measures.","heading":"Immediate Protocol Response","severity":"high","sources":[{"credibility":1,"name":"Summer.fi — Lazy Summer USDC Vault Exploit Post-Mortem","type":"official","url":"https://blog.summer.fi/lazy-summer-usdc-vault-exploit-post-mortem-what-happened-and-what-comes-next/"},{"credibility":1,"name":"CoinDesk — DeFi protocol Summer.fi halts Lazy Summer vaults after $6 million exploit","type":"news_article","url":"https://www.coindesk.com/web3/2026/07/06/defi-protocol-summer-fi-halts-lazy-summer-vaults-after-usd6-million-exploit"}]},{"content":"On July 15, 2026, nine days after the exploit, Summer.fi published a formal shutdown announcement on its blog. The company stated it had 'concluded we have no viable path forward other than to wind down operations.' The announcement cited three compounding factors: the $6.04 million extracted from depositors, the team's personal capital losses (a meaningful portion of the team's own capital was held in the affected vaults), and the elimination of the financial runway required to rebuild. Summer.fi Labs committed to keeping the application interface live until August 31, 2026, with technical support available through support@summer.fi and Discord during the wind-down period. The company emphasized that the Lazy Summer Protocol itself — governed by the Lazy Summer DAO — would continue to exist on-chain independent of the company's closure. Vault contracts would remain deployed and permissionless, with shares redeemable regardless of the front-end's status. The SUMR token declined more than 18% in the immediate aftermath of the exploit disclosure.","heading":"Shutdown Announcement and Wind-Down","severity":"critical","sources":[{"credibility":1,"name":"Summer.fi — Sunsetting Summer.fi and the Labs Company","type":"official","url":"https://blog.summer.fi/sunsetting-summer-fi-and-the-labs-company/"},{"credibility":2,"name":"Web3 Is Going Great — Summer Finance exploited for $6 million, shuts down","type":"news_article","url":"https://www.web3isgoinggreat.com/single/summer-finance-exploit"},{"credibility":2,"name":"BeInCrypto — $6 Million Vault Exploit Forces DeFi Platform Summer.fi to Wind Down","type":"news_article","url":"https://beincrypto.com/summer-fi-shutdown-lazy-summer-exploit/"}]},{"content":"Following the exploit, the Lazy Summer DAO assumed governance responsibility for the protocol's recovery and withdrawal restoration. The DAO passed multiple governance proposals to complete the offboarding cleanup that the incomplete operational process had left vulnerable. Specifically, proposals SIP2.59.1 through SIP2.59.12 (risk-managed vaults) and SIP7.3.1 through SIP7.3.2 (DAO-managed vaults) were executed to fully remove legacy strategies from active vault sets across all networks. For the two directly affected Ethereum USDC vaults, proposals SIP1.7 and SIP1.8 completed cleanup, followed by SIP1.9 which established a Merkl distribution contract for remaining USDC. On July 30, 2026, the DAO published that all Lazy Summer Vaults were available for withdrawal. The announcement confirmed that the distribution mechanism socialized losses rather than recovering the stolen $6.04 million. Affected vault users can claim their pro-rata share of remaining assets through Merkl or the Summer.fi interface. No compensation decision has been announced; the DAO post-mortem indicated any reimbursement discussion would take place in the Lazy Summer DAO governance forum.","heading":"DAO Governance and Vault Recovery","severity":"high","sources":[{"credibility":1,"name":"Summer.fi — All Lazy Summer Vaults are now available for withdrawal","type":"official","url":"https://blog.summer.fi/all-lazy-summer-vaults-are-now-available-for-withdrawal/"},{"credibility":2,"name":"Bitget News — Summer.fi shuts down after exploit, Lazy Summer DAO to resume withdrawals","type":"news_article","url":"https://www.bitget.com/asia/news/detail/12560605509769"},{"credibility":1,"name":"Summer.fi — Lazy Summer USDC Vault Exploit Post-Mortem","type":"official","url":"https://blog.summer.fi/lazy-summer-usdc-vault-exploit-post-mortem-what-happened-and-what-comes-next/"}]},{"content":"The exploit extracted approximately $6.04 million from two Lazy Summer Protocol USDC vaults: approximately $5.64 million from LazyVault_LowerRisk_USDC and approximately $0.40 million from LazyVault_HigherRisk_USDC. The attacker used a $65.4 million flash loan to achieve a net profit of approximately $6.04 million, representing the difference between the 70.96 million USDC redeemed and the 64.83 million USDC deposited plus flash loan repayment. The protocol's pre-exploit TVL was approximately $22 million, meaning the exploit removed roughly 27% of total value locked. The SUMR token declined more than 18% following the incident disclosure. The stolen funds were converted to approximately 6.017 million DAI via Curve before being laundered through Tornado Cash. No stolen funds have been recovered as of the time of writing.","heading":"Financial Impact and Losses","severity":"critical","sources":[{"credibility":1,"name":"Summer.fi — Lazy Summer USDC Vault Exploit Post-Mortem","type":"official","url":"https://blog.summer.fi/lazy-summer-usdc-vault-exploit-post-mortem-what-happened-and-what-comes-next/"},{"credibility":2,"name":"Metaverse Post — Summer.fi Suffers $6M DeFi Exploit After Alleged Flash Loan Manipulates Vault Accounting","type":"news_article","url":"https://mpost.io/summer-fi-suffers-6m-defi-exploit-after-alleged-flash-loan-manipulates-vault-accounting/"},{"credibility":1,"name":"CoinDesk — DeFi protocol Summer.fi halts Lazy Summer vaults after $6 million exploit","type":"news_article","url":"https://www.coindesk.com/web3/2026/07/06/defi-protocol-summer-fi-halts-lazy-summer-vaults-after-usd6-million-exploit"}]},{"content":"The Summer.fi exploit occurred within a pattern of significant DeFi losses in 2026. According to CryptoRank data cited in reporting, 121 DeFi hacking incidents were documented in 2026 representing nearly $942 million in aggregate losses. The attack is notable as an example of DeFi contagion: a collapse at Stream Finance in November 2025 created a stale-valuation vulnerability that persisted undetected for eight months before being weaponized. The exploit also illustrates systemic risk in ERC-4626 vault architectures where incomplete operational procedures — rather than code errors — can create exploitable attack surfaces. The attacker's documented three-month preparation period, beginning April 2026, indicates sophisticated adversarial research into the protocol's operational state rather than automated opportunism.","heading":"Broader DeFi Context","severity":"medium","sources":[{"credibility":2,"name":"CryptoTimes — $6M Lazy Summer Exploit Traces Back to November's Stream Finance Collapse","type":"news_article","url":"https://www.cryptotimes.io/2026/07/08/6m-lazy-summer-exploit-traces-back-to-novembers-stream-finance-collapse/"},{"credibility":2,"name":"Bankless — Lazy Summer Protocol Drained of $6M in Vault Price Exploit","type":"news_article","url":"https://www.bankless.com/read/news/lazy-summer-protocol-drained-of-6m-in-vault-price-exploit"},{"credibility":2,"name":"Crypto Economy — Summer Finance Hit for $6M in Flash-Loan Liquidity Manipulation","type":"news_article","url":"https://crypto-economy.com/summer-finance-hit-for-6m-in-flash-loan-liquidity-manipulation/"}]}],"sources_used":[{"credibility":1,"name":"Summer.fi — Lazy Summer USDC Vault Exploit Post-Mortem","type":"official","url":"https://blog.summer.fi/lazy-summer-usdc-vault-exploit-post-mortem-what-happened-and-what-comes-next/"},{"credibility":1,"name":"Summer.fi — Sunsetting Summer.fi and the Labs Company","type":"official","url":"https://blog.summer.fi/sunsetting-summer-fi-and-the-labs-company/"},{"credibility":1,"name":"Summer.fi — All Lazy Summer Vaults are now available for withdrawal","type":"official","url":"https://blog.summer.fi/all-lazy-summer-vaults-are-now-available-for-withdrawal/"},{"credibility":1,"name":"CoinDesk — DeFi protocol Summer.fi halts Lazy Summer vaults after $6 million exploit","type":"news_article","url":"https://www.coindesk.com/web3/2026/07/06/defi-protocol-summer-fi-halts-lazy-summer-vaults-after-usd6-million-exploit"},{"credibility":1,"name":"The Block — DeFi protocol Summer Finance exploited for $6 million","type":"news_article","url":"https://www.theblock.co/post/407198/summer-finance-exploited"},{"credibility":2,"name":"The Defiant — Summer.fi Hacker Moves $1.35M Into Tornado Cash","type":"news_article","url":"https://thedefiant.io/news/hacks/summer-fi-hacker-moves-1-35m-into-tornado-cash"},{"credibility":2,"name":"Verichains — Lazy Summer Hack Analysis: Stale-Asset Donation and ERC-4626 Share-Price Manipulation","type":"research","url":"https://blog.verichains.io/p/lazy-summer-hack-analysis-stale-asset"},{"credibility":2,"name":"CryptoTimes — $6M Lazy Summer Exploit Traces Back to November's Stream Finance Collapse","type":"news_article","url":"https://www.cryptotimes.io/2026/07/08/6m-lazy-summer-exploit-traces-back-to-novembers-stream-finance-collapse/"},{"credibility":2,"name":"Crypto Briefing — Summer.fi hacker launders $1M through Tornado Cash after $6M exploit","type":"news_article","url":"https://cryptobriefing.com/summer-fi-hacker-launders-tornado-cash/"},{"credibility":2,"name":"Bankless — Lazy Summer Protocol Drained of $6M in Vault Price Exploit","type":"news_article","url":"https://www.bankless.com/read/news/lazy-summer-protocol-drained-of-6m-in-vault-price-exploit"},{"credibility":2,"name":"BeInCrypto — $6 Million Vault Exploit Forces DeFi Platform Summer.fi to Wind Down","type":"news_article","url":"https://beincrypto.com/summer-fi-shutdown-lazy-summer-exploit/"},{"credibility":2,"name":"Web3 Is Going Great — Summer Finance exploited for $6 million, shuts down","type":"news_article","url":"https://www.web3isgoinggreat.com/single/summer-finance-exploit"},{"credibility":2,"name":"FinanceFeeds — Summer Finance Exploited for $6 Million in Flash Loan Attack","type":"news_article","url":"https://financefeeds.com/summer-finance-exploited-for-6-million-in-flash-loan-attack/"},{"credibility":2,"name":"Bitcoin.com News — Summer Finance Pauses Vaults After $65.4M Flash Loan Attack Triggers $6M Loss","type":"news_article","url":"https://news.bitcoin.com/summer-finance-pauses-vaults-after-65-4m-flash-loan-attack-triggers-6m-loss/"},{"credibility":2,"name":"Bitget News — Summer.fi shuts down after exploit, Lazy Summer DAO to resume withdrawals","type":"news_article","url":"https://www.bitget.com/asia/news/detail/12560605509769"},{"credibility":2,"name":"Crypto Economy — Summer.fi Confirms Shutdown Following Major USDC Vault Exploit","type":"news_article","url":"https://crypto-economy.com/summer-fi-confirms-shutdown-following-exploit/"},{"credibility":2,"name":"Metaverse Post — Summer.fi Suffers $6M DeFi Exploit After Alleged Flash Loan Manipulates Vault Accounting","type":"news_article","url":"https://mpost.io/summer-fi-suffers-6m-defi-exploit-after-alleged-flash-loan-manipulates-vault-accounting/"},{"credibility":2,"name":"Yahoo Finance — Hackers Reportedly Drain $6 Million From DeFi Protocol Summer.fi","type":"news_article","url":"https://finance.yahoo.com/markets/crypto/articles/hackers-reportedly-drain-6-million-075620230.html"},{"credibility":2,"name":"Cryptonomist — SummerFi DeFi Shutdown After Lazy Summer Protocol Exploit","type":"news_article","url":"https://en.cryptonomist.ch/2026/07/20/summerfi-defi-shutdown/"},{"credibility":1,"name":"Summer.fi — Lazy Summer Protocol SUMR Token page","type":"official","url":"https://summer.fi/earn/sumr"}],"summary":"On July 6, 2026, an attacker used a $65.4 million Morpho flash loan to exploit a stale-asset share-price manipulation vulnerability in Summer.fi's Lazy Summer Protocol, extracting approximately $6.04 million in DAI from two Ethereum USDC vaults. The stolen funds were subsequently laundered through Tornado Cash. On July 15, 2026, Summer.fi Labs announced it had no viable path forward and would cease operations by August 31, 2026, with governance of the Lazy Summer Protocol transferring entirely to the Lazy Summer DAO.","timeline":[{"date":"2025-11","event":"Stream Finance collapses following a $93 million loss disclosed by an external fund manager; xUSD token crashes 77%, leaving Silo Varlamore USDC Growth tokens with stale inflated on-chain valuations.","source":"CryptoTimes","source_url":"https://www.cryptotimes.io/2026/07/08/6m-lazy-summer-exploit-traces-back-to-novembers-stream-finance-collapse/"},{"date":"2026-04-06","event":"Attacker begins funding multiple wallets and systematically accumulating stale Silo Varlamore tokens in preparation for the exploit, approximately three months before execution.","source":"Summer.fi Exploit Post-Mortem (official)","source_url":"https://blog.summer.fi/lazy-summer-usdc-vault-exploit-post-mortem-what-happened-and-what-comes-next/"},{"date":"2026-07-06","event":"At 05:17 AM UTC, attacker executes single atomic transaction using a $65.4 million Morpho flash loan to manipulate share prices across two Lazy Summer USDC vaults, extracting approximately $6.04 million in DAI.","source":"Summer.fi Exploit Post-Mortem (official)","source_url":"https://blog.summer.fi/lazy-summer-usdc-vault-exploit-post-mortem-what-happened-and-what-comes-next/"},{"date":"2026-07-06","event":"At 05:36 AM UTC, Blockaid flags the attack. By 06:42 AM UTC, deposit caps are zeroed on affected vaults. At 10:25 AM UTC, Guardian multisig pauses all Lazy Summer Protocol vaults on Ethereum, Base, Arbitrum, and Sonic.","source":"Summer.fi Exploit Post-Mortem (official)","source_url":"https://blog.summer.fi/lazy-summer-usdc-vault-exploit-post-mortem-what-happened-and-what-comes-next/"},{"date":"2026-07-06","event":"SUMR token declines more than 18% following public disclosure of the exploit.","source":"CoinDesk","source_url":"https://www.coindesk.com/web3/2026/07/06/defi-protocol-summer-fi-halts-lazy-summer-vaults-after-usd6-million-exploit"},{"date":"2026-07-09","event":"Attacker begins laundering stolen funds through Tornado Cash; approximately $1.35 million in DAI has been converted to ETH and deposited into the mixer in batches of 10 ETH or larger.","source":"The Defiant","source_url":"https://thedefiant.io/news/hacks/summer-fi-hacker-moves-1-35m-into-tornado-cash"},{"date":"2026-07-15","event":"Summer.fi Labs publishes formal shutdown announcement, stating the company has 'no viable path forward other than to wind down operations.' The application is to remain live until August 31, 2026.","source":"Summer.fi blog (official)","source_url":"https://blog.summer.fi/sunsetting-summer-fi-and-the-labs-company/"},{"date":"2026-07-30","event":"Lazy Summer DAO completes offboarding cleanup across all networks via governance proposals SIP1.7, SIP1.8, SIP1.9, SIP2.59.1-12, and SIP7.3.1-2; all Lazy Summer Vaults reopened for withdrawal, with affected vault users directed to Merkl distribution contracts.","source":"Summer.fi blog (official)","source_url":"https://blog.summer.fi/all-lazy-summer-vaults-are-now-available-for-withdrawal/"},{"date":"2026-08-31","event":"Final operational date for the Summer.fi application and support channels. Lazy Summer Protocol smart contracts remain deployed on-chain under DAO governance.","source":"Summer.fi — Sunsetting Summer.fi and the Labs Company","source_url":"https://blog.summer.fi/sunsetting-summer-fi-and-the-labs-company/"}]},"v":1}Verify offline (run on your own machine)python -m src.verify_decision 9b948496-336e-40a4-a7b6-41556d7dde6c
How verification works. The “Row integrity” check above is computed in your browser — your machine recomputes the SHA-256 of the canonical bytes and compares against the stored hash. No avoid.net server can fake that check. The “full verify” link goes one level deeper: your browser fetches the on-chain transaction from a Solana RPC node and confirms the same hash is in the memo. If you don’t want to trust either avoid.net or the public RPC, run the CLI verifier on your own machine —
python -m src.verify_decision <event_id>.