Incident Overview
EDE Finance was hit by an Oracle Manipulation exploit resulting in a loss of $658,370 $USD. The attacker returned $420,170 to the team but kept the rest.
EDE Finance is a DEX on the Binance Smart Chain and Arbitrum. The project was exploited through oracle manipulation which resulted in a loss of 658,370 $USD. A white hat hacker was able to exploit the project's vault and stole the assets.
Consequently, 420,170 $USD were returned by the white hat to the project. An on-chain message was sent by the hacker with the following text: "All trades that were executed were using prices signed/produced by the devs which allowed anyone to take advantage of these prices and easily empty out the entire ELP pool with just a few transactions. The malicious activity involved intentionally signing incorrect prices to manipulate users' positions and steal their funds while implementing backdoors that allowed them to force liquidate any position they desired.
The whole pool was always at risk as there were additional vulnerabilities present too provided you agreed upon certain terms."
Attacker address:
https://arbiscan.io/address/0x80826E98…4932DC
Malicious transaction example:
https://arbiscan.io/tx/0x3758a4b7…35163e
Attacker's message:
https://arbiscan.io/tx/0x76799a57…cbcfb0
Incident Report
Protocol Information
What the Attacker Needed to Succeed
Understanding the prerequisites for this type of attack helps auditors identify protocols that are most at risk and helps developers build better defenses.
What Auditors Should Check
If you're auditing a protocol with similar architecture to EDE Finance, these are the critical security checks that could have prevented this incident (May 2023).
- Verify all logic paths related to Other are guarded by proper access controls and input validation
- Review privileged functions (owner, admin, governance) for potential abuse vectors - centralization risks should be documented and bounded with timelocks or multi-sigs
Master these auditing techniques with hands-on labs and real exploit scenarios in the Smart Contract Hacking course.
Free TrialFunds Recovery
Recovered
$420K
Net Loss
238329
Sources & References
Learn to Prevent the Next EDE Finance
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