Vyper disclosed critical Curve-linked flaw as Alchemix recovery finished

A critical compiler advisory

On August 5, 2023, Vyper’s maintainers published a critical security advisory identifying incorrectly allocated named reentrancy locks in compiler versions 0.2.15, 0.2.16 and 0.3.0. The defect had already been implicated in the July 30 attacks against several liquidity pools deployed through Curve Finance.

The advisory explained that functions using the same named lock could receive different storage slots. Under a specific combination of contract design and execution order, that mistake permitted cross-function reentrancy: an external call could re-enter another function before the first function finished updating state. The maintainers identified Vyper 0.3.1 as the patched version and advised affected developers to upgrade.

That scope is important. The advisory did not say every contract compiled with those releases was exploitable. It listed additional conditions, including use of the `@nonreentrant` decorator and an external call occurring before relevant storage updates. The verified development on August 5 was therefore a critical compiler disclosure with defined prerequisites—not evidence that all Vyper contracts or all Curve pools were compromised.

Alchemix received the remaining ETH

The disclosure coincided with a material recovery for Alchemix. On August 5, Alchemix announced that all assets taken by the attacker from its Curve alETH-ETH pool had been returned. A contemporaneous report recorded that announcement and said the attacker had previously returned 4,820.55 alETH before completing the process on August 5.

Ethereum’s transaction record independently verifies the final ETH movements. The Etherscan-labeled Alchemix/CurveFinance exploiter address transferred 1 ETH, 2,999 ETH and 2,000 ETH to the Alchemix developer multisignature wallet between 18:38:47 and 19:57:35 UTC on August 5. Those three transfers total exactly 5,000 ETH. The same address had received approximately 7,258.70 ETH from the exploit contract on July 30.

The blockchain establishes the amounts, addresses, timestamps and successful transaction status. Address labels and the interpretation that the transfers represented restitution depend on Etherscan attribution, the recipient protocol’s statement and the surrounding transaction history. The transactions alone cannot establish the sender’s identity, motive or legal status.

Why the development mattered

The Vyper advisory converted a fast-moving exploit narrative into an actionable software-security record. Protocol teams could check compiler versions and contract structure rather than treating every Vyper deployment as equally exposed. It also showed how a defect below the application layer could propagate into independently operated pools holding substantial user liquidity.

The Alchemix return reduced one part of the immediate loss and demonstrated that public transaction records could verify restitution without relying exclusively on a project statement. It did not make the entire Curve incident whole. Multiple pools and actors were involved, and Alchemix’s claim concerned assets taken by the attacker from its pool—not every loss experienced by liquidity providers across the broader incident.

No cryptocurrency price or percentage-return claim is made here. Continuous trading, venue differences and UTC candle boundaries would make a generalized event-day market reaction unreliable without a specified instrument and dataset. The significance on August 5 was operational: a critical vulnerability was formally scoped while one affected protocol recovered the attacker-held assets attributable to its pool.

Later clarification

Alchemix’s September 21 postmortem later stated that the attacker had taken 4,821 alETH and 7,258 ETH and returned those assets over August 4–5. It also reported that a separate arbitrage transaction removed another 3,856 alETH, leaving a partial backing loss. That later account clarifies why the August 5 phrase “all funds” must be read narrowly: it referred to assets held by the identified attacker, not complete restoration of every liquidity-provider position.