Velodrome Finance, a trading and liquidity marketplace, announced the recovery of $350,000 stolen on August 4. However, the occasion turned bittersweet when internal investigations pointed to the involvement of a prominent member of the team, who goes by the pseudonym Gabagool.
On August 4, one of Velodrome’s high-value wallets—dedicated to operating funds, such as salaries—was stripped of $350,000. before they could be transferred to the multisig wallet from the company’s treasury funds. A subsequent internal investigation revealed the identity of the attacker, allowing the company to recover all the loot.. Velodrome’s official statement revealed:
“To our disappointment, we learned that the attacker was a teammate, Gabagool.”
Although many members of the community turned out to support the prominent coder, Gabagool admitted to the accusations made against him following the Velodrome investigation.
An update from Velodrome on our investigation into the team wallet exploit. pic.twitter.com/sz1ePStcT0
— Velodrome (,) (@VelodromeFi) August 13, 2022
An update from Velodrome on our investigation of the team’s wallet exploit.
Nearly six hours after the revelation, Gabagool published a note explaining various events that led him to attempt the robbery. Velodrome’s biggest mistake was giving ownership of his wallet’s private key to five people, including Gabagool.
Gabagool, like many other investors, lost large amounts of money during the cryptocurrency crash of 2022. In an attempt to recoup losses, Gabagool made a hasty decision to withdraw $350,000 in various cryptocurrencies only to convert it to Ether (ETH) and send it to Tornado Cash..
By the time Gabagool decided to return the stolen funds, Velodrome investigators “revealed that they had already discovered my involvement”. He ended the note stating:
“There’s not much else to say. I’m extremely stupid, incredibly disappointed in myself and (frankly) not sure what’s next, legally speaking.”
On the other hand, Velodrome revealed to be working with legal counsel to determine the next steps. Looking to the future Velodrome has decided to revoke ownership of team members’ private keys and instead establish gnosis vaults for all monetary operations.
BlueBenx, a Brazilian cryptocurrency lending platform, also encountered a hack, but what followed was unmatched by Velodrome Finance. BlueBenx would have blocked all of its 22,000 users from withdrawing their funds after an alleged hack that drained $32 million.
Although no details about the hack have been revealed, many investors have been concerned about the matterand one of them has declared:
“I think there’s a good chance it’s a scam, because this whole hacker attack story seems like a big lie, something they’ve made up.”
The lack of confidence among investors stems from the fact that Numerous cryptocurrency platforms have recently halted fund withdrawals while hiding their incompetence in delivering previously promised returns to users.yes
Clarification: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information set forth herein should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
Investments in crypto assets are not regulated. They may not be suitable for retail investors and the full amount invested may be lost. The services or products offered are not aimed at or accessible to investors in Spain.