How much was lost in the Exactly Protocol hack?

The Exactly Protocol hack resulted in $7.2M in losses on August 18, 2023.

What attack technique was used in the Exactly Protocol exploit?

The Exactly Protocol exploit utilized Reentrancy. Understanding this attack vector is critical for smart contract auditors and developers building secure DeFi protocols.

How can developers prevent similar smart contract attacks?

Preventing smart contract hacks requires a combination of secure coding practices, thorough security audits, and understanding common attack vectors like reentrancy, oracle manipulation, and access control flaws. Smart Contract Hacking (SCH) provides hands-on training to help developers and auditors identify and prevent vulnerabilities before deployment.

Exactly Protocol Hack

TOTAL LOST $7.2M

Medium Aug 18, 2023 Reentrancy

Affected Chain 2023 Incident surface

Recovered - No recovery reported

All-Time Rank #370 By amount stolen

Protocol Type CDP Target category

Incident Overview

Quick Summary

Exactly Protocol suffered a reentrancy attack, resulting in the loss of 4332.92 ETH, valued at approximately 7,197,240 $USD.

Details of the Exploit

On August 18, 2023, Exactly Protocol, a lending and borrowing protocol operating on the Optimism chain, was exploited through a reentrancy attack. The attacker bypassed the permit check in the DebtManager contract's leverage function by using a fake market address without validation and changing the msg.sender to the victim's address. They then reentered the crossDeleverage function and stole the collaterals.

The stolen funds, a total of 4332.92 ETH, were bridged to the Ethereum mainnet, partly through the Across Protocol and partly via the Optimism Bridge. The value of the loss was approximately 7,197,240 $USD.

The Exactly:Deployer sent an on-chain message to the exploiter, expressing willingness to discuss the incident and providing instructions for private communication.

Block Data Reference

Optimism:

Attacker Addresses:

1. https://optimistic.etherscan.io/address/0x3747dbbc…571af9

2. https://optimistic.etherscan.io/address/0xE4f34a72…9da042

Malicious Transactions:

1. https://optimistic.etherscan.io/tx/0xe8999fb5…813585

2. https://optimistic.etherscan.io/tx/0x1526acfb…0cfad6

3. https://optimistic.etherscan.io/tx/0x3d6367de…3a520e

Malicious Contract:

https://optimistic.etherscan.io/address/0x6dd61c69…1a5b4d

Bridging Transaction:

https://optimistic.etherscan.io/tx/0x27f0fd95…8b8a31

Ethereum:

Funds Holder:

https://etherscan.io/address/0xE4f34a72…9da042

Bridging Transaction:

https://etherscan.io/tx/0x77461e80…826849

Onchain Message:

https://etherscan.io/tx/0x91dd9c55…2fe3d1

This is classified as a Reentrancy . Compare similar hacks →

Incident Report

Protocol / Project Exactly Protocol

Date of Incident August 18, 2023

Attack Technique Reentrancy

Classification Borrowing and Lending

Primary Source View Post-Mortem #1 View Post-Mortem #2

Protocol Information

Protocol Type CDP

Affected Token EXA

Official Website exact.ly/

Protocol Twitter/X @ExactlyProtocol

Team Anonymous

Source Code Verified On-Chain

Market Context at Time of Hack

Token Categories

Optimism Ecosystem

Protocol Links

GitHub Discord Telegram

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.

Technical Knowledge Deep understanding of reentrancy and Solidity and EVM internals

Capital Required Seed capital to cover gas and initial position setup

On-Chain Access Ability to interact with smart contracts and deploy a custom exploit contract

Protocol Analysis Identification of the exploitable vulnerability in Exactly Protocol's contract logic - root cause: borrowing and lending

Execution Speed Precise transaction ordering and timing to exploit the vulnerability within a single atomic block

Obfuscation Plan A strategy to launder and move stolen funds - typically through mixers, cross-chain bridges, or decentralized DEX swaps to resist tracing

What Auditors Should Check

Could this have been caught in audit? Yes — skilled auditors routinely flag Reentrancy vulnerabilities in code review

If you're auditing a protocol with similar architecture to Exactly Protocol, these are the critical security checks that could have prevented this incident (August 2023).

Verify all logic paths related to Reentrancy are guarded by proper access controls and input validation - see the Reentrancy attack class for patterns
Check that all state-changing functions follow the Checks-Effects-Interactions (CEI) pattern to prevent reentrancy and logic ordering bugs
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.

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Related Attack Classes

The technique used in this hack maps to these vulnerability classes in our security curriculum:

See all Reentrancy examples →

Reentrancy

Sources & References

01
Source 1 https://twitter.com/ExactlyProtocol/status/1692509323690184966
02
Source 2 https://beincrypto.com/exactly-protocol-hackers-steal-7m/

Threat Assessment

Severity Level

MEDIUM

Attack Vector Reentrancy
Root Cause Borrowing and Lending
Year 2023

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