How much was lost in the Linear Finance hack?

The Linear Finance hack resulted in $212K in losses on September 21, 2023.

What attack technique was used in the Linear Finance exploit?

The Linear Finance exploit utilized Other. 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.

Linear Finance Hack

TOTAL LOST $212K

Low Sep 21, 2023 Other

Affected Chain 2023 Incident surface

Recovered - No recovery reported

All-Time Rank #1272 By amount stolen

Auditors 1 Prior security audit

Incident Overview

Quick Summary

Linear Finance exploited on Sep 21, 2023, draining lUSD liquidity on PancakeSwap and AscendEX, with losses exceeding 211,726 USD (1,000 BNB).

Details of the Exploit

Linear Finance, a non-custodial, cross-chain compatible, delta-one asset protocol, was exploited on Sep 21, 2023. The attacker minted an unlimited supply of LAAVE, traded it for LUSD on the Linear Exchange, and sold the tokens on PancakeSwap and Ascendex decentralized exchanges. As a result, all lUSD liquidity was drained on both platforms.

The LUSD value collapsed to zero when its liquidity pools were drained. Despite the attack, the protocol's LINA token appears to be unaffected, trading flat at $0.011 at the time of writing. All smart contracts and bridges on the protocol have been halted by the team.

The stolen funds were transferred to another EOA and then deposited into TornadoCash. The exact loss amount is not known, but the confirmed loss is more than 1,000 BNB (211,726 USD) as of Sep 26, 2023.

Block Data Reference

Attacker Addresses:

https://bscscan.com/address/0xAC70Eba7…417Fc2

https://bscscan.com/address/0x8D7755e2…956fc0

https://bscscan.com/address/0xb3E11885…acF7E1

https://bscscan.com/address/0x047a83F8…07660a

Malicious Transaction Example:

https://bscscan.com/tx/0x6558c6c4…e00fb5

TornadoCash Deposit Transactions:

https://bscscan.com/tx/0x5c53e93b…101122

https://bscscan.com/tx/0x2e4de99c…198d5a

AscendEX Deposit Transaction:

https://bscscan.com/tx/0xeb5d1a2c…59b28c

Incident Report

Protocol / Project Linear Finance

Date of Incident September 21, 2023

Attack Technique Other

Classification Stablecoin,Token

Primary Source View Post-Mortem

Protocol Information

Protocol Type Derivatives

Affected Token lUSD

Official Website linear.finance/

Protocol Twitter/X @LinearFinance

Team Anonymous

Source Code Verified On-Chain

Market Context at Time of Hack

Token Categories

Decentralized Exchange (DEX) Token DeFi Ethereum Ecosystem Polkadot Yield Farming Polkadot Ecosystem Binance Launchpad CMS Holdings Portfolio

Protocol Links

GitHub Discord Reddit

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 other 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 Linear Finance's contract logic - root cause: stablecoin,token

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? Likely — with a thorough Other audit checklist and test coverage

Audited by Audit Report 1 — still lost $212K. Prior audits don't guarantee safety, especially after post-audit code changes.

If you're auditing a protocol with similar architecture to Linear Finance, these are the critical security checks that could have prevented this incident (September 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.

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Security Audit History

Audit Report 1 Report

Sources & References

01
Source 1 https://twitter.com/CryptoHunterQ/status/1705221816258564588
02
Web Archive https://archive.ph/VyzwN

Threat Assessment

Severity Level

LOW

Attack Vector Other
Root Cause Stablecoin,Token
Year 2023

Learn to Prevent the Next Linear Finance

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