Velvet Capital was forced to temporarily shut down its website to prevent a massive phishing attack

DeFi asset management protocol Velvet Capital was forced to temporarily shut down its website to prevent a large-scale phishing attack. X user said on April 23 that Velvet Capital's trading platform had unusual activity. When users tried to connect to the front-end, they were prompted to approve their wallet's access to the protocol. After an internal investigation, Velvet Capital issued a cybersecurity alert, advising investors to deny all wallet connection requests from the application until further notice. Investors who may have approved fraudulent requests need to revoke wallet access to the protocol to avoid loss of funds. In addition, Velvet Capital disabled the application to minimize the possibility of further losses for investors. Velvet Capital founder Vasily Nikonov announced the website closure on Telegram: "Please be careful not to interact with the Velvet website. We are shutting down the website for maintenance and investigating the problem. A post-mortem report will be released after the problem is resolved." Nearly two hours after the website was shut down, Nikonov said he was working with the technical team and security researchers to regain control of the website from the hackers. Blockchain investigation firms Blockaid and Scam Sniffer confirmed that Velvet Capital had been hacked before the site officially announced the breach. Users who have confirmed transactions on Velvet Capital since 5:39 UTC on April 23 may have become victims of cybercrime. Nikonov suggested that these users submit information on Discord and share transaction details with the Velvet Capital team for remediation. Nikonov emphasized that as of 6:50 UTC, no users have reported losses. (Cointelegraph)