DeltaPrime DeFi, operating on the Arbitrum platform, has faced a major hacking attack, resulting in the theft of $5.98 million from its liquidity pools. The incident was reported by Cyvers alerts.
Exploiting the Private Key
The main attack was based on the use of a private key associated with DeltaPrime's admin account. Using this key, the attacker was able to execute a transaction that upgraded the proxy contract, gaining control over the platform's liquidity pools such as DPUSDC, DPARB, DPWETH, and DPBTCb. Initially, the total estimated loss was $4.5 million, later rising to nearly $6 million ($5.98 million). The address associated with the hacker exchanged USDC for ETH to avoid USDC from being frozen and transferred 1,200 ETH (approximately $2.8 million) to another address to prevent being tracked.
DeltaPrime Blue VS DeltaPrime Red
Fortunately, the attack did not affect DeltaPrime Red, which runs on the Avalanche blockchain. In an official announcement, the team mentioned that DeltaPrime Red is protected by multisigs and cold wallets, meaning the hacking occurred only on DeltaPrime Blue in Arbitrum, leaving the rest of the funds uncompromised.
Continuing Recovery Efforts
DeltaPrime DeFi has started the process of recovering the lost funds, and an insurance pool will be used to possibly compensate users' funds. The team has noted that they are testing various strategies to minimize the impact on users while emphasizing security measures to prevent such attacks in the future. The attack underscores the importance of private key protection in the DeFi sphere, as many experts have noted that using Web3 security tools could indicate suspicious transactions, such as proxy upgrades, which could help prevent asset loss.
The attack on DeltaPrime DeFi serves as a crucial reminder of the need for robust private key protection and advanced security measures in the DeFi space to prevent similar incidents in the future.
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