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Velvet Capital Deactivates Website Due to Phishing Attack Concerns
Velvet Capital, a decentralized finance (DeFi) asset management protocol backed by Binance Labs, recently faced concerns over a potential phishing attack, leading to the temporary deactivation of its website.
Suspicious Activity Triggers Action
Reports of abnormal behavior on Velvet Capital’s trading platform emerged, with users encountering prompts to authorize wallet access when trying to connect to the website.
Immediate Response
Recognizing the potential threat, Velvet Capital swiftly initiated internal investigations and issued a cybersecurity alert advising investors not to approve wallet connection requests until further notice.
Founder Vasily Nikonov took decisive action to safeguard investor funds by announcing the temporary closure of the website on Telegram.
Security Measures and Collaboration
Nikonov urged investors to interact with the platform only after maintenance and security measures had been completed to minimize potential user losses and prevent cybercriminals from accessing funds.
Efforts were underway to regain control of the platform and address the security breach through collaboration with technical experts and security researchers.
Blockchain Investigation and Remediation
Blockchain investigation firms corroborated Velvet Capital’s acknowledgment of the website hack. Users who may have unwittingly approved fraudulent transactions were urged to report details for remediation.
No users had reported financial losses as of the latest update.
Web3 Space Faces Over $200 Million in Losses Due to Hacks in 2024
In the first two months of 2024, the Web3 space experienced over $200 million in losses due to hacks and rug pulls, highlighting a significant increase compared to the same period in 2023.
Incident Analysis
According to a report by Immunefi, a blockchain cybersecurity platform, the losses across 32 specific incidents saw a 15.4% increase from the previous year.
Hacks remained a significant security concern, accounting for the majority of the total losses, while fraud constituted a smaller percentage.
Key Concerns and Future Outlook
Private key and wallet compromises contributed significantly to the total losses year-to-date, with warnings of potentially record-breaking losses in 2024.
Jonah Michaels, Communications Lead at Immunefi, emphasized the need for heightened security measures to combat the rising trend of financial losses in the Web3 space.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
