DeFi
$10 million stolen in Velocore DEX attack
DeFi just got hit again, and this time it’s a $10 million hit. A hacker stole funds from Velocore, a decentralized exchange (DEX) on the zkSync and Linea blockchains on June 2, 2024. This raises a big question: are our crypto assets safe in the wild world of DeFi?
Here is what happened.
Discover the breach
The breach was first discovered by cyber threat researcher Officer’s Notes. Velocore’s liquidity provider tokens, essential to the operation of the exchange, have been compromised. Hackers stole over 1,700 ETH, worth over $7 million, and transferred the funds to the Ethereum mainnet.
The attacker initially acquired Ether through Tornado Cash, a platform that improves transaction privacy. The stolen funds were then routed through Across Bridge and sent back to Tornado Cash to anonymize the transactions. By the time the breach was detected, the hacker had transferred approximately 1,700 ETH, or $7 million, to Tornado Cash.
Security measures
Although Velocore underwent security audits by Zokyo, Hacken and Scalebit, the hacker successfully exploited the platform. Fortunately, Velocore’s stablecoin pools were not affected, allowing users to safely withdraw their funds from these reserves.
The Velocore team works with cybersecurity experts and centralized exchanges (CEX) to freeze stolen funds and prevent further losses.
Negotiations are underway…!
Velocore has figured out how the exploit occurred and is currently negotiating with the attacker. The team proposed a 10% bonus on the white hat for the return of remaining funds before June 3 at 8:00 UTC. However, the hacker has not yet responded.
In their post-mortem report, Velocore promised to compensate those affected by the hack.
“For those affected, we were able to take a snapshot of the state of the blockchain before the attack. After operations resume, we will develop an appropriate mitigation plan in which, collectively, we can ensure that appropriate compensation has been paid to those who lost money to the attackers. »
Velocore
Impact on Velocore: the market reacts!
The hack had a significant impact on Velocore’s native token, VC, which reached its lowest point after the attack. However, the token has since recovered and is trading at $0.004127 at the time of writing.
Despite the hack, traffic on the zkSync and Linea blockchains remained subdued, with both networks maintaining high transaction throughput and address activity before and after the attack.
Also discover: May Crypto Hacking Report: $347 Million Wiped From Markets!
Is DeFi safe? There is no definitive answer. What you can do is stay vigilant and follow best practices to protect your crypto holdings.