Velocore Exchange Hacked: Key Insights on $773 Million Cryptocurrency Breach

  • The cryptocurrency sector has witnessed yet another security lapse, this time targeting the Velocore exchange.
  • Notably, this incident follows closely on the heels of several other recent high-profile security breaches within the industry.
  • Statements from Velocore officials reveal insights into the magnitude of the attack and the subsequent response efforts.

Recent security breaches in cryptocurrency exchanges call for urgent attention to code auditing and asset security.

Velocore Exchange Incident Details

Velocore, an exchange utilizing zkSync and Linea networks, recently fell victim to a significant hacking event. This breach is part of a troubling trend of increasing cyber attacks on both centralized and decentralized cryptocurrency platforms. Typically, these incidents occur due to vulnerabilities in the platforms’ codes, often stemming from insufficient code audits, leading to considerable financial damage.

Once the hackers gained control of the assets, they reportedly used crypto mixers to obfuscate the stolen funds, complicating tracking efforts. Initial reports about the breach were disclosed by a threat researcher operating under the pseudonym “Officer’s Notes.”

Identifying the Perpetrators

The Velocore team has confirmed that the attackers primarily targeted liquidity provider tokens. Following the exploitation, over 700 Ether were transferred to the Ethereum mainnet. Despite the efforts of notable security firms like Zokyo, Hacken, and Scalebit to audit Velocore’s code, the hackers managed to bypass these defenses.

In a concurrent event, the Linea blockchain experienced an unexplained one-hour pause during the attack. Velocore administration announced an ongoing investigation and efforts to freeze the stolen assets in collaboration with centralized exchanges. They also revealed plans for an on-chain negotiation process and are preparing a comprehensive post-mortem article on the incident.

“We have pinpointed the exploit mechanism and are initiating on-chain negotiations. Our team is diligently tracking the exploit with available clues. Further updates will follow. Note that Velocore on the Telos mainnet remains unaffected. We are collaborating with the foundation while functions are temporarily frozen. Guidance on safely withdrawing funds will be provided soon,” Velocore representatives stated.

Investor Takeaways

– Verify that your chosen exchanges conduct thorough and frequent security audits.

– Utilize hardware wallets or similarly secure methods for storing significant amounts of cryptocurrency.

– Stay vigilant and promptly respond to security breach announcements and follow up on recommended actions from exchanges.

Conclusion

The path forward for affected investors remains clouded as Velocore has not yet provided a definitive reimbursement or compensation strategy. This incident underscores the alarming $773 million in losses due to various exploits in the first half of this year alone, with May recording $51 million in theft across 21 different attacks. Investors are keenly awaiting updates as the Velocore team continues their investigation.

You can follow our news on Telegram, Twitter (X), and CoinMarketCap. Disclaimer: The information provided in this article does not constitute financial advice. Cryptocurrency investments are highly volatile and carry significant risks. Investors are advised to conduct thorough research before making any investment decisions.

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Gideon Wolf
Gideon Wolfhttps://en.coinotag.com/
GideonWolff is a 27-year-old technical analyst and journalist with extensive experience in the cryptocurrency industry. With a focus on technical analysis and news reporting, GideonWolff provides valuable insights on market trends and potential opportunities for both investors and those interested in the world of cryptocurrency.
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