Velocore Exchange DEX Suffers Hacker Attack and Loses $10 Million in Crypto

In the recent wave of security breaches in the cryptocurrency world, Velocore, a decentralized exchange (DEX) operating on the zkSync and Linea blockchains, faced a significant attack, resulting in the loss of around $10 million. This event reignites concerns about persistent security in the cryptocurrency sector.

The Velocore hack was initially detected by a security researcher known as “Official Notes,” who highlighted critical vulnerabilities in the sector. Hackers manipulated Velocore liquidity provider tokens, which are essential for the exchange’s functionality. These tokens were transferred, resulting in over 700 ETH moved to the Ethereum mainnet.

Despite having passed renowned security audits carried out by Zokyo, Hacken and Scalebit, the Velocore platform was unable to prevent exploitation. During the attack, block production on Linea Blockchain was abruptly halted for an hour, although the specific causes of the pause have not yet been clarified.

In response to the breach, Velocore announced that it is working with centralized exchanges to freeze the stolen assets and minimize further damage. “We have identified the exploitation mechanism and are establishing a chain negotiation process. A detailed analysis is underway. We are tracking the hacker with clues left behind. More updates coming soon,” the Velocore team stated in a recent statement.

🔊Update on Velocore Incident

The Velocore DEX was exploited. Our teams have been employing our ecosystem security measures to mitigate the damage from this attack. More info in this thread.

Linea network remains secure, this only affected a 3rd party dapp.

— Linea (@LineaBuild) June 2, 2024

Furthermore, it was mentioned that the exchange’s stable pools were not affected, allowing users to withdraw their funds without any problems. Continuous interaction with the Telos foundation ensures that Velocore on this platform’s mainnet is unimpacted and secure.

The community affected by the hack has already started demanding refunds, but to date, Velocore has not yet outlined concrete compensation plans. This incident underscores the continued need to strengthen security measures across all cryptocurrency platforms.

Historically, the crypto sector has already lost more than US$473.22 million in 2024 due to security breaches, excluding the recent loss of DMM Bitcoin, which totaled US$305 million. In May this year, 21 incidents resulted in additional losses of more than US$52 million, highlighting the critical challenges that still need to be overcome.

Disclaimer:

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