Hackers breach Solv Protocol vault and steal $2.7 million in crypto

Key points:

• The DeFi platform Solv Protocol was attacked, with roughly $2.7 million in crypto assets stolen.
• The project team promised to fully reimburse affected users and offered the hacker 10% of the stolen funds if they return the assets.

Solv Protocol, a Bitcoin-based decentralized finance platform, reported that one of its token vaults was compromised. The attacker managed to withdraw crypto assets worth about $2.7 million.

In response, the project offered the hacker a “white hat” bounty—10% of the stolen amount—in exchange for returning the funds.

Source: X.com

In a post on , Solv said the incident affected fewer than ten users. The platform also promised to fully compensate the losses—38.05 Solv Protocol BTC (SolvBTC), a token pegged to Bitcoin.

The team added that additional security measures have already been implemented to prevent similar incidents in the future. The investigation is being conducted together with crypto security firms Hypernative, SlowMist, and CertiK.

What We Know About the Cause of the Hack

Solv Protocol allows users to deposit Bitcoin and receive SolvBTC in return. These tokens can then be used across other blockchains—for example, for lending, borrowing, or staking.

According to the project, the protocol currently holds 24,226 BTC in reserves, worth more than $1.7 billion. The team claims this represents the largest Bitcoin reserve on-chain.

So far, Solv has not confirmed the exact cause of the vulnerability. However, two crypto security researchers believe the issue may have originated in one of the protocol’s smart contracts. The flaw allegedly allowed the attacker to create an excessive amount of internal tokens.

Chris Dior, co-founder of security firm CD Security, said the attacker exploited the vulnerability 22 times before swapping hundreds of millions of the newly minted tokens for just over 38 SolvBTC.

A pseudonymous security researcher known as Pyro described the exploit as a reentrancy attack. This type of attack occurs when unexpected input allows an attacker to repeatedly call a smart contract function and withdraw funds.

Reentrancy vulnerabilities have been one of the most common security issues in the DeFi sector for years.