Technical analysis of the Hyperliquid hotspot event from the perspective of blockchain security
The main reason Hyperliquid is widely discussed in the community today is the potential security risks in its bridging contracts—$2.3 billion in USDC assets rely on a 3/4 multi-signature mechanism for protection among four validators, while multiple known North Korean hacker addresses have been recently active in transaction records on its platform. This has led to some panic selling in the community, with the highest drop exceeding 25% on the day of hype, a market value evaporation of over $7 billion, and more than $150 million in outflow from on-chain ecological funds.
This conflict at the technical and ecological level is very representative in the current DeFi security.
The following will provide an in-depth analysis from three perspectives: risks of the validator mechanism, behavior patterns of North Korean hackers, and potential mitigation measures:
I. Core issues of the validator mechanism: Overly centralized design and potential attack scenarios
Currently, there are only four validators for the Hyperliquid bridging contract, which is an extreme multi-signature structure in DeFi projects. The $2.3 billion USDC assets rely on the agreement of 3/4 validators, exposing two obvious risks:
(1) Validators being compromised
Attack results: Once hackers control 3 validators, they can sign malicious transactions, transferring $2.3 billion USDC to the attackers' address. This risk is extremely serious and is almost impossible to intercept through conventional means such as firewalls. Unless the assets transferred from Arbitrum are rolled back, but this would lose all meaning of decentralization.
Technical intrusion paths The North Korean hacker team possesses top-tier attack capabilities in the encryption industry, with classic intrusion paths including:
Social engineering attacks: Sending phishing emails disguised as partners or trusted entities with malicious links, implanting RAT (Remote Access Trojan).
Supply chain attacks: If the validator's device relies on unsigned binaries or third-party components, hackers can gain control by implanting malicious update packages.
Zero-day vulnerability attacks: Exploiting zero-day vulnerabilities in Chrome or other commonly used software to execute malicious code directly on the validator's device.
(2) Issues of validator credibility and distribution
Currently, Hyperliquid's validator architecture seems to have the following weaknesses:
Is the code running on the validator completely consistent? Is there a decentralized build and runtime environment?
Is there a centralized physical distribution of validators? If validator nodes in the same area are physically attacked or disconnected from the network, attackers may find it easier to target the remaining nodes.
Is the security of validators' personal devices under unified corporate management? If validators use personal devices to access critical systems without deploying security monitoring measures such as EDR (Endpoint Detection and Response), the attack surface will be further amplified.
II. North Korean hacker attack methods: From traces to potential threats
The hacking behavior patterns revealed by overseas famous blogger Tay deserve high vigilance, implying a systematic attack strategy behind them:
(1) Why do hackers choose Hyperliquid?
High-value targets: 2.3 billion USDC is enough to attract any top hacker team, and assets of this scale have sufficient motivation for attack.
Weak validator mechanisms: Only three validators need to be compromised to control all assets, making this low-threshold attack path very attractive.
Trading activities as a testing method: Hackers execute transactions to test system stability, possibly to collect behavioral patterns of the Hyperliquid system, such as transaction processing delays, anomaly detection mechanisms, etc., to provide data support for the next attack.
(2) The expected path of the attack
Hackers are likely to take the following steps:
Collect identity information and social activities of validators, sending targeted phishing emails or messages.
Implant RAT on validators' devices to gain control of the device through remote access.
Analyze Hyperliquid's trading logic and submit fund withdrawal requests through forged transaction signatures.
Finally execute the fund transfer, sending USDC to various mixing services on multiple chains for laundering.
(3) Expansion of attack targets
Although Hyperliquid's assets have not been stolen yet, the active trading traces of hackers indicate that they are conducting 'lurking' or 'probe attacks'. The community should not ignore these warnings, as they often represent an important preparation stage for attackers before executing an attack.
III. Currently feasible mitigation measures: How to prevent attacks from happening?
To address this risk, Hyperliquid needs to implement the following improvements as soon as possible:
(1) Decentralization of the validator architecture
Increase the number of validators: Increase from the current 4 validators to 15-20, significantly raising the difficulty for hackers to simultaneously compromise most validators.
Adopt a distributed operating environment: Ensure validator nodes are distributed across multiple regions globally, with physical and network environments isolated from each other.
Introduce different code implementations: To avoid single points of failure, the running code of validators can adopt different implementations (e.g., dual versions of Rust and Go).
(2) Improve the security of validators' devices
Dedicated device management: All key operations of validators must be completed on dedicated devices managed by Hyperliquid and a complete EDR system must be deployed for monitoring.
Disable unsigned binaries: All files running on validator devices must undergo unified signature verification by Hyperliquid to prevent supply chain attacks.
Regular security training: Educate and train validators on social engineering attacks to enhance their ability to identify phishing emails and malicious links.
(3) Protection mechanisms at the bridging contract level
Delayed transaction mechanism: Set a delay execution mechanism for large fund withdrawals (e.g., over $10 million) to provide the community and team with response time.
Dynamic validation thresholds: Adjust the number of required validators based on the withdrawal amount, for example, requiring 90% of validators' signatures for amounts exceeding a certain threshold.
(4) Improve attack detection and response capabilities
Blacklist mechanism: Collaborate with Circle to directly reject transaction requests marked as malicious addresses.
On-chain activity monitoring: Real-time monitoring of all abnormal activities on Hyperliquid, such as sudden increases in large transaction frequencies and abnormal validator signing behaviors.
Summary
The issues exposed by Hyperliquid today are not isolated cases but represent a systemic hazard commonly found in the current DeFi ecosystem: the emphasis on validator mechanisms and off-chain security is far lower than on the contract level.
No actual attacks have occurred yet, but this incident serves as a strong warning. Hyperliquid needs to rapidly enhance the decentralization and security of validators at the technical level, and also promote comprehensive discussions and improvements on bridging contract risks within the community. Otherwise, these potential hazards may be truly exploited in the future, leading to irreversible losses.
