HermesVault — Verifier LogicSig Rekey Attack

Timeline: On 19 May 2026, the HermesVault exploit hit the Algorand private ZK transactions protocol (app id 2952336704). Vector confirmed verbatim by Giulio Pizzini (lead engineer, Algorand Foundation): 'The vulnerability was a faulty guard in the verifier LogicSig against rekeying. This allowed the attacker to rekey the withdrawal verifier and use it to drain funds, bypassing the zk verification path.' Rekey transaction PPYN7EUFUOMGKHJJSZG2DDYMSUIF66LV2YOXMSEJGLVUOYLJCSVQ executed by the attacker to take control of the withdrawal verifier LogicSig. Then withdrawal transaction ZBNGF7QOQ6MZZP2PUXPK5VOLZSQBU3QTEYW6UVX4J2JSU2ACEQ7Q drained ~261,000 ALGO (~$29,466) to 2PYF5VFHZYXR7NDXHEPVNJJ73FKTXKTQ3TAUH6ZIIEEL73MCTXUN4GQEL4. The core zk circuit (Plonk + MiMC via algoplonk) is NOT compromised. On 20 May 2026 at 01:06 UTC, Pizzini published the complete post-mortem on X with attacker address + 2 txids verbatim. 230,000 ALGO (~88%) already refunded as of disclosure. ~30,000 ALGO remaining refundable on email request to info@hermesvault.org with proof of control of deposit address + secret note. algoplonk has been patched. Deposits disabled, HermesVault retired. ZK is not enough: even with a Zcash-grade Plonk + MiMC circuit, the defense logic surrounding LogicSigs is a critical attack surface.