Virtuals Protocol denies exposure as Wasabi Protocol loses $5.5M in exploit

Wasabi Protocol was exploited in late April after an attacker obtained a private key and upgraded vault admin rights, draining roughly $5.5M across multiple chains. The attacker emptied permissionless vaults on Ethereum, Base, Blast and Berachain — converting and bridging funds (including about $1.9M in WETH) back to Ethereum and mixing some via Tornado Cash. Wasabi’s TVL was about $8.52M before the hack; LP-share tokens from compromised vaults are now effectively worthless and users have been urged to revoke approvals. On-chain firms (PeckShield, Blockaid) and researchers flagged private-key theft and centralization (single wallet control) as the likely cause. Partner Virtuals Protocol said its funds were safe but paused interactions. Market impact is concentrated: loss of user funds, degraded trust in small DeFi protocols, and renewed scrutiny on key-management and multisig/timelock protections for upgradeable vaults.