Velodrome Finance Hack

TOTAL LOST $42K
Low Other

Summarize with AI

ChatGPT Perplexity Claude Grok
Affected Chain 2023 Incident surface
Recovered - No recovery reported
All-Time Rank #1756 By amount stolen
Protocol Type Dexs Target category

Incident Overview

Quick Summary

Velodrome DEX on Optimism chain was exploited due to a DNS attack, resulting in a loss of 42,000 USD.

Details of the Exploit

Velodrome, a decentralized trading protocol on the Optimism chain, experienced a DNS attack on November 29, 2023. The frontend was compromised, and users were urged not to interact with the platform. The Velodrome team regained control of their domain after a social engineering attack on their provider.

However, the provider was exploited again, and the frontend was compromised a second time. The domain was eventually restored and locked at the TLD level. The stolen funds, totaling 42,000 USD, were distributed among multiple addresses and deposited into KuCoin.

Block Data Reference

Attacker Addresses:

https://optimistic.etherscan.io/address/0xf64fCEdF…231443

https://optimistic.etherscan.io/address/0x02BA13f3…C4ae78

KuCoin Deposit Transactions:

https://etherscan.io/tx/0xf51eac8b…ca3e64

https://etherscan.io/tx/0x8ac2654b…dc509e

https://optimistic.etherscan.io/tx/0x607d00b8…0c670e

Incident Report

Protocol / Project Velodrome Finance
Date of Incident
Attack Technique Other
Classification Exchange (DEX)
Primary Source View Post-Mortem

Protocol Information

Protocol Type Dexs
Official Website velodrome.finance/
Protocol Twitter/X @VelodromeFi
Team Anonymous
Source Code Unverified

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 Velodrome Finance's contract logic - root cause: exchange (dex)
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

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

Sources & References

Browse all hacks

These hacks used the same attack technique. Understanding the pattern helps prevent future exploits.

DeFiTuna $570K
Other
Cascade $1.3M
Other
Lumi Finance $264K
Other
Hinkal $820K
Other
AIDCToken $121K
Other
Polymarket $3.0M
Other

Learn to Prevent the Next Velodrome Finance

The Velodrome Finance hack is one of many attacks that skilled auditors are trained to detect before deployment. Master real exploit patterns and defense techniques with hands-on Web3 security training.

Start Free Trial Browse Attack Library
Recreate exploit patterns safely Free Trial