Velocore Faces Exploitation, Loses About $10 Million: Report  Coin Edition

• Velocore has been reportedly hacked, resulting in a loss of about $10 million.

• The platform has initiated an investigation into the exploitation and froze stolen funds.

• However, the hacker managed to move some of the stolen ETH to the Ethereum mainnet.

Velocore, a decentralized exchange (DEX) protocol on zkSync and Linea, has reportedly been hacked, causing customers to lose almost $10 million in funds. In response to the exploitation, the Velocore team initiated an investigation into the hack, setting up an “on-chain negotiation process.”

Velocore Exploit Update

Weve identified the exploit mechanism and are setting up an on-chain negotiation process. A post-mortem article is in the works. Tracking the exploiter with clues left behind. More updates soon.

Velocore on the Telos mainnet has not been affected, and…

— Velocore | veDEX on zkSync Era / Linea ▪️ (@velocorexyz) June 2, 2024

The hack was initially reported by the Chinese crypto reporter Colin Wu on his Wu Blockchain page on X, following which crypto commentator MartyParty also reposted the report.

Velocare shared an “Emergency Notice” after facing the hack, cautioning clients against the exploitation. Consequently, the team halted the platforms operations, freezing the stolen funds. However, the hackers were reportedly able to transfer a portion of the stolen Ether tokens across chains to the Ethereum mainnet.

The DEX protocol asserted that it had sought the help of the security team to resolve the issue. Velocores emergency notice read,

Emergency Notice

Velocore has been exploited, resulting in the loss of most of the liquidity. Our CPMM pools have been affected, but the stable pools have not been impacted, so funds can be withdrawn on our stable pools.

We are working with security teams and foundations, and…

— Velocore | veDEX on zkSync Era / Linea ▪️ (@velocorexyz) June 2, 2024

In its recent post, Velocore revealed that the team has identified the exploit mechanism and promised to provide more updates soon. In addition, the team guaranteed guidance for safe withdrawal in the future. Further, the team cited, “Velocore on the Telos mainnet has not been affected, and we are working with the foundation while functionalities are frozen.”