What happened
Sonne Finance's Optimism markets were exploited for approximately $20 million in May 2024. The attacker used an empty-market donation vulnerability in Sonne's Compound V2 fork after permissionless execution of timed market-creation and collateral-factor changes.
Compound V2 calculates a market exchange rate from its cash, borrows, reserves, and share supply. A newly created market with an extremely small share supply allowed a direct token donation to inflate the exchange rate. Sonne's intended zero-collateral initialization was split across publicly executable Optimism timelock transactions, letting the attacker sequence market creation and collateral activation before the protective setup was complete.
Case & protocol details
Attack Timeline
The attacker minted 2 wei of soVELO in a new market, then directly transferred borrowed VELO to the soVELO contract. The donation increased the market's cash without issuing additional soVELO, inflating its exchange rate. That made 2 wei of soVELO appear to be valuable collateral, allowing the attacker to borrow other assets.
A rounding-down path in redeemUnderlying then allowed the attacker to recover the donated VELO with only 1 wei of soVELO and repeat the pattern against further markets.
Evidence & learning
Attack pattern
Compare incidents →Proof of concept
1 availableSources and on-chain records
- report Post-mortem medium.com
- transaction Transaction optimistic.etherscan.io
- analysis Website reference neptunemutual.com
- analysis Sonne Finance incident analysis certik.com
- analysis BlockSec May 2024 security review blocksec.com
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