Jan 05, 2024 Frank Stewskid
January 2024 Gamma Strategies Exploit: A Report
On January 4, 2024, Gamma Strategies, a known player in the Ethereum-based decentralized finance (DeFi) sector, faced a security breach estimated to be worth nearly $3.4 million. The incident was first identified by PeckShield, a blockchain security and analytics firm.
Our follow-up analysis indicates the issue is related to @GammaStrategies, not @CryptoAlgebra: https://t.co/KbwPwrGZkS
— PeckShieldAlert (@PeckShieldAlert) January 4, 2024
How did the Gamma Strategies hack unfold?
The Gamma Strategies attack was executed through the manipulation of the protocol's price change thresholds. These thresholds, which are crucial for preventing market manipulation, were reportedly set to allow larger than typical price fluctuations. This setting enabled the attacker to artificially inflate prices and extract funds.
Following the detection of the breach, Gamma Strategies suspended all deposits into their system to prevent further exploitation and initiated contact with the attacker, proposing a bounty for the return of stolen assets.
We have preliminarily reached the root cause of the recent exploit attack on our vaults.
— Gamma (@GammaStrategies) January 4, 2024
Out of abundance of caution, we shut off all deposits on our public-facing vaults -- this effectively nullifies the attack any further because a deposit is required for the attack to take…
What is the latest development around the incident?
Besides promising the release of a detailed post-mortem of the incident, Gamma Strategies announced it will be getting a third-party code review before continuing operation and reopening deposits. Furthermore, the company is committed to maximizing the recovery of lost assets for its users. DeFi Teller has learned that the project has attempted to negotiate the return of the stolen assets with the attacker in exchange for an undisclosed bounty, however, there has been no response. Furthermore, according to Peckshiled, the hacker has already transferred 1000 ETH worth around $2.2million to popular crypto mixer Tornado Cash.
#PeckShieldAlert @GammaStrategies Exploiter-labeled address has transferred 1K $ETH (worth ~$2.2M) to #tornadocash pic.twitter.com/Ins4Fa5cmX
— PeckShieldAlert (@PeckShieldAlert) January 4, 2024
What is Gamma Strategies?
Gamma Strategies operates within the DeFi sector, providing liquidity management solutions on the Ethereum blockchain. Their services include the use of algorithms and strategies for managing digital assets in the volatile cryptocurrency market.
