Level Finance Hacked for $1.1M: DeFi Attacks on the Rise in 2023

Level Finance Hack

Level Finance Hack

Another day, another hack in the decentralized finance (DeFi) market. The Level Finance Hack. On May 2, Level Finance, a BNB Chain-based decentralized and non-custodial perpetual market, announced on Twitter that it had suffered an attack resulting in the theft of $1.1 million worth of LVL tokens.

According to the team, the attacker targeted the Referral Controller Contract to drain 214,000 LVL tokens before swapping them for BNB tokens. However, the team quickly isolated the exploit and deployed a patch in just 12 hours. They also reassured users that liquidity pools and the DAO treasury were unaffected by the attack.

Level Finance is a decentralized and non-custodial perpetual market built on the BNB Chain. The platform boasts a total value locked (TVL) of $32.5 million, down from approximately $41 million prior to the hack. The platform provides programmatic pools of liquidity, efficient hedging of capital, and risk management, and its utility token, LVL, incentivizes use across the ecosystem.

Unfortunately, DeFi attacks continue to plague the market, with 2023 seeing an uptick in such incidents. In fact, in the past few weeks alone, there have been several other attacks. While it is not yet as bad as the previous year, where hacks were much more frequent, a single large hack could change the current trend quickly.

For example, hackers managed to steal $20 million in February, which is still significantly less than the amounts stolen in 2022.

The year’s most significant hacks include Euler Finance, which resulted in the loss of $197 million, and Sentiment, which saw the theft of $1 million. Interestingly, in both cases, the teams negotiated with the hackers, resulting in the return of most of the stolen funds.

The team behind Level Finance has promised to release a post-mortem report soon, which may shed some light on the incident and what they are doing to prevent such attacks from happening in the future.

DeFi hacks continue to be a significant concern for the market, and users must remain vigilant in their dealings with such platforms.