A Balance of the Targeted Attack Published by dYdX

In a recent statement shared on its X account (formerly Twitter), decentralized protocol dYdX has announced that it has identified the attacker behind the targeted attack in November 2023, revealing numerous details about the incident.

On November 17, 2023, dYdX suffered an attack that resulted in a loss of $9 million from its insurance fund, representing approximately 40% of the total fund.

According to the statement, the attacker employed a strategy of opening multiple long positions using over 100 different wallets, causing a 215% increase in the price of YFI.

However, on November 18, the price of YFI plummeted by nearly 30% in one hour, and the attacker was unable to close their positions, resulting in losses covered by the insurance fund.

Measures Taken by dYdX

In response to the attack, dYdX implemented measures to strengthen its V3 platform, enhancing monitoring of open positions and alerts to prevent future similar attacks.

As for its V4, dYdX states that this version is specifically designed to mitigate risks similar to this incident. Notably, it includes a feature that automatically adjusts the initial margin fraction in case of abnormal price movements.

dYdX confirmed that it is considering legal action against the individual responsible for the attack, while ensuring that client funds were not affected and the attacker did not benefit from YFI market manipulation.