Velvet Capital, Binance Labs-Backed DeFi Protocol, Temporarily Offline Amid Phishing Attack Concerns

Velvet Capital, a decentralised finance (DeFi) asset management protocol backed by Binance Labs, temporarily shut down its website to thwart a phishing attack that targeted users attempting to access the platform. Users encountered unusual activity on April 23, prompting the platform to issue a cybersecurity alert advising investors to deny wallet connect requests until further notice. Velvet Capital urged users who might have inadvertently approved fraudulent requests to revoke wallet access to prevent potential loss of funds. Founder Vasily Nikonov announced the temporary closure on Telegram, stating that the team was working to regain control from hackers. While no losses were reported initially, users who confirmed transactions since April 23, 5:39 am UTC, were advised to open a ticket on Discord for remediation. This incident mirrors similar front-end hacks experienced by DeFi protocols Aerodrome and Velodrome in November 2023, indicating an ongoing challenge for the DeFi sector in safeguarding user assets against cyber threats.