Bittime - Velocore, a DEX platform operating on the Telos, zkSync Era, and Linea blockchains, fell victim to a cyberattack in the early hours of yesterday. The hack exploited a vulnerability in the smart contract that regulates the liquidity pool Velocore, and resulted in a loss of approximately $6.8 million in crypto tokens.
Hackers Manipulate Velocore System
The attacker exploited a loophole in the overflow logic to manipulate Velocore. This attack makes the system mistakenly treat small withdrawals as deposits of large amounts.
With the help of a flash loan, the perpetrator succeeded in draining Velocore's volatile pool (a collection of volatile crypto assets) on zkSync Era and Linea.
The Velocore team is ready to secure assets on the Telos network. Meanwhile, Velocore's stable pool (a collection of stable crypto assets) was not affected by the attack.
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Velocore Response and Recovery Efforts
In their post-mortem report, Velocore stated that despite undergoing multiple audits and implementing preventive measures to ensure safety, these unexpected incidents occurred quickly.
Velocore also apologized to users. As a recovery effort, Velocore has disabled the logic loopholes exploited by the perpetrators, thereby closing the opportunity for similar attacks in the future.
Linea Protocol Response to Those Affected
In response to this incident, the Linea network, Layer 2 Ethereum (built by ConsenSys) was forced to temporarily stop block production to prevent losses due to the attack from increasing. This move, although not completely successful, was aimed at protecting users on the Linea network.
Linea Protocol states that because other means of dealing with this exploit are closed, the Linea team is stopping the sequencer to prevent additional funds from going out. This is the final action they are taking to protect users on Linea.
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Velocore Offers to Performers and User Compensation
Velocore has attempted to contact the perpetrator of the attack. They are offering a "white hat bounty" of 10% of the stolen funds if returned before June 3 2024 at 15:00 WIB. Unfortunately, until now there has been no response from the perpetrator.
Meanwhile, Velocore also promised to provide compensation to affected users. Velocore has taken a snapshot of the state of the blockchain before the incident occurred. Once operations return to normal, Velocore will implement an appropriate compensation plan to address the losses experienced by users.
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Monitor price chart movements of Bitcoin (BTC) , Ethereum (ETH) , Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.
Read Also:
Alleged Velocore Hack on 2 Blockchains, zkSync and Linea
Velocore Identify the Cause of the Hack and Disable Specific Features
Velocore Exchange on zkSync Hacked, Suffering Losses of Approximately $10 Million
DISCLAIMER: This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.
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