- Velocore has experienced a serious security breach resulting in significant financial losses.
- An initial investigation has been launched, and stolen funds have been frozen to prevent further losses.
- Despite these efforts, some of the stolen Ether (ETH) has been moved to the Ethereum mainnet by the hacker.
A detailed examination of Velocore’s $10M hack and its implications for the crypto exchange platform.
Velocore Suffers Major Security Breach Resulting in $10 Million Loss
In a significant blow to the decentralized exchange (DEX) community, Velocore, operating on the zkSync and Linea platforms, has fallen victim to a major hack. The security breach led to an estimated loss of nearly $10 million in customer funds. Velocore has swiftly responded by initiating a comprehensive investigation into the incident and setting up an “on-chain negotiation process” to manage the fallout.
Initial Reports and Community Response
The news of the hack was initially broken by Chinese crypto journalist Colin Wu via his Wu Blockchain page on X, leading to widespread awareness within the crypto community. Soon after, notable crypto commentator MartyParty echoed the report, amplifying the concern among stakeholders. The community was promptly notified through an “Emergency Notice” issued by Velocore, cautioning users against further engagements with the platform amid operations being halted to safeguard remaining assets.
Actions Taken by Velocore Post-Hack
Upon confirming the hack, Velocore took immediate preventive measures including freezing the stolen funds to mitigate additional financial damage. Despite their efforts, it has been reported that the perpetrator managed to relocate a portion of the pilfered Ether tokens from zkSync and Linea to the Ethereum mainnet, complicating the recovery process.
Efforts and Collaboration Towards Resolution
Velocore has confirmed that it is actively collaborating with an expert security team to delve into the intricacies of the exploit. In a recent update, the protocol’s team shared that they have successfully identified the exploit mechanism, assuring users that further updates will be provided in due course. Importantly, Velocore stated that operations on the Telos mainnet remain unaffected and that they are working closely with the Telos foundation during this period when functionalities are temporarily frozen.
Conclusion
This incident underscores the persistent security vulnerabilities that decentralized platforms must navigate. Velocore’s swift response and ongoing investigation highlight the necessity for robust security protocols and rapid response mechanisms within the crypto ecosystem. As the situation evolves, stakeholders will be keenly watching for updates and guidance on safe fund withdrawals and any additional measures to prevent future occurrences.
