What Is a ‘Governance Attack’ and What Are Its Potential Financial Consequences?

A governance attack is a malicious act where an attacker exploits the protocol's governance mechanism to gain unauthorized control or extract value. This could involve manipulating a voting threshold, exploiting a smart contract vulnerability exposed by a proposal, or passing a self-serving proposal like draining the treasury.

The financial consequences are severe, including the immediate loss of funds from the protocol's treasury or liquidity pools, a catastrophic drop in the token's price, and a complete loss of trust, potentially leading to the project's demise.