Curve Exploit Post Mortem

4 min readSep 21, 2023

Summary

On July 30th, 2023, Curve contacted the Alchemix team alerting us of a vulnerability in several of their pools, including our alETH — ETH pool.

The Alchemix Multisig team immediately started work to pull AMO-owned liquidity from the affected pool, and they successfully removed 8,027 alETH before the remainder of the pool was drained by the exploiter.

The funds stolen by the exploiter consisted of 4,821 alETH and 7,258 ETH.

Details of Vulnerability & Fix

The exploit was a result of a latent vulnerability in the Vyper compiler, which was used to create the affected Curve pools. The bug was present in versions 0.2.15, 0.2.16, and 0.3.0. The bug was patched in version 0.3.1, but Vyper were not aware of the impact of using the vulnerable compilers at the time.

All future alAsset pools deployed by Curve will be using Vyper version 0.3.1 and above, and they will no longer have this vulnerability.

Chronology

Some times are estimated.

July 30th, 2023:
14:49 UTC — Curve contacted the Alchemix team alerting us to a vulnerability in our alETH — ETH pool

14:55 UTC — The Alchemix Multisig team met and immediately started to remove liquidity from the affected pool.

15:21 UTC — 8027 alETH was unstaked and removed from the pool.(1-2)
Due to the nature of the AMO, a balanced complete withdrawal is only possible with the sweep function, which removes the entirety of the funds to the Multisig. This is behind a timelock function, so given the time-sensitive nature of the vulnerability, the only practical possible functions to withdraw liquidity and keep it in the AMO contract were to withdraw funds single sided (as alETH or ETH). alETH was done first to balance the pool, with the intent to withdraw the remainder as ETH in a follow-up transaction. The pool was drained while submitting txn for ETH withdrawal.

15:34 — 4,821 alETH and 7,258 ETH in the pool was removed by the exploiter.(3)

15:34 — The remaining 3,856 alETH left in the pool was removed by an arbitrage bot. The net result of the exploiter and arbitrage bot resulted in a partial loss of backing to alETH of approximately 5,000 ETH.(4)

~18:00 UTC — Out of an abundance of caution, the Multisig team paused the alETH Transmuter, Disabled Yield tokens and bridging.(5–18)

August 4th-5th, 2023:
13:21 onwards — The exploiter returned all alETH stolen from the LP over several transactions.(19–21)

14:20 onwards — Hacker returned all ETH stolen from the LP over several transactions.(22–26)

Moving forward

Alchemix is working with Curve to analyze LP positions prior to the attack and develop a compensation plan. The exact nature of compensation will include returning the recovered funds to LPers (including the Alchemix AMO), as well as potential compensation from Curve in the form of vested CRV tokens.

alETH vaults have been unpaused, and all yield flow, repays, and self-liquidations have been redirected to the AMO contract per AIP-97.(27)

Some Arbitrageurs have returned profits, and we are continuing to reach out to others.(28)

Stuck bridgers were partially reimbursed, as per AIP-96.(29)