DeltaPrime Experiences $6 Million Token Drain Due to Private Key Leak

DeltaPrime Suffers Major Token Drain Following Private Key Leak

In a significant security breach early Monday, over $6 million worth of various tokens were drained from wallets belonging to the on-chain brokerage DeltaPrime, according to reports from security researchers on X. This alarming incident appears to stem from a private key leak, raising concerns over the security protocols of the platform.

DeltaPrime operates on both the Arbitrum and Avalanche blockchains, but the exploit primarily affected the Arbitrum version as of the European morning hours. Users were unable to withdraw their funds on the Arbitrum platform due to the unique structure of borrowing and lending utilized in this system.

A hacker managed to gain control of the wallet 0xx40e4ff9e018462ce71fa34abdfa27b8c5e2b1afb, which is recognized as the admin wallet for proxies. With this access, the hacker upgraded the proxies to redirect to a malicious contract identified as 0xD4CA224a176A59ed1a346FA86C3e921e01659E73. Fuzzland founder Chaofan Shou detailed this progression on X, highlighting the severe implications of such a breach.

Proxies serve as intermediary contracts that facilitate interactions between users and other contracts. They are designed with minimal logic but play a crucial role in any decentralized application; consequently, a compromise at this level can jeopardize the entire protocol.

Security firm Cyvers confirmed the exploit in a Telegram message to CoinDesk, reporting that they detected “multiple suspicious transactions” involving DeltaPrime. The firm indicated that it appeared the admin had lost the private key, which is a critical component of this incident.

• Affected pools identified thus far include:
• #DPUSDC – holding USDC stablecoins
• #DPARB – associated with Arbitrum’s ARB
• #DPBTCb – related to bitcoin (BTC)

Messages from DeltaPrime team members, as observed in their Discord channel by CoinDesk, indicated that the team was actively investigating the situation and working to address the issue. However, they did not explicitly confirm the exploit or disclose specific details as of the European morning hours.

In the wake of this incident, DeltaPrime’s PRIME tokens have experienced a decline of 6.5% over the past 24 hours, mirroring a broader market downturn led primarily by ether (ETH).