{"id":6947,"date":"2023-12-06T20:51:36","date_gmt":"2023-12-06T20:51:36","guid":{"rendered":"https:\/\/de.fi\/blog\/?p=6947"},"modified":"2023-12-14T21:19:47","modified_gmt":"2023-12-14T21:19:47","slug":"manage-revoke-optimism-token-approvals","status":"publish","type":"post","link":"https:\/\/de.fi\/blog\/manage-revoke-optimism-token-approvals","title":{"rendered":"How to Manage & Revoke Optimism Token Approvals"},"content":{"rendered":"\n

Optimism<\/a> is one of the most popular Ethereum Layer 2 chains for DeFi. With over $800 million in TVL, there are countless yield farming<\/a>, NFT, and social dapp opportunities for users. However, while Optimism is trusted as a best-in-class L2 network, you must stay vigilant to avoid potential crypto rug pulls<\/a> across the chain. Like any other permissionless blockchain, you’re only a few clicks away from a phishing scam<\/a> or honeypot<\/a> exploit.<\/p>\n\n\n\n

One of the most important keys to reinforcing your Optimism safety is understanding the approvals and permissions<\/a> granted by your DeFi wallet<\/a>. If you’re auditing your Optimism account activity and looking to find a way to remove potentially harmful permissions or token approvals, you’re in the right place. <\/p>\n\n\n\n

In this blog, we’ll walk through what Optimism token approvals are and how you can audit + revoke them using the free De.Fi Shield<\/a> tool.<\/p>\n\n\n\n

What Are Optimism Token Approvals?<\/h2>\n\n\n\n

Optimism token approvals can go by many names including token permissions, smart contract permissions, token allowances, etc. To be clear though, these are all referencing the same concept: settings within your wallet that allow for dapps to access and move Optimism network crypto assets on your behalf.<\/p>\n\n\n\n

Examples of this could include a DEX like Camelot or an NFT exchange like OpenSea. When you are interacting with these platforms, the only way for them to fulfill their duties is for you to allow their underlying smart contract to interact with and extract the Optimism assets you wish to use. This is done by signing an approval with your wallet.<\/p>\n\n\n\n

In the screenshot below, you can see the process of granting Velodrome DEX permissions to interact with the VELO tokens<\/a> on Optimism network stored within a MetaMask wallet<\/a>. This token approval uses a specific custom spending cap as well which is a security best practice:<\/p>\n\n\n

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\"setting<\/figure>\n<\/div>\n\n\n

These permissions are incredibly powerful because they allow the smart contract you interact with to have control over your Optimism wallet’s funds even if you do not approve a specific transaction.<\/em> This can lead to a nightmare scenario of losing access to your funds under the following circumstances:<\/p>\n\n\n\n

You grant approvals to an untrustworthy smart contract:<\/strong> Token approvals are the main attack vector for\u00a0crypto phishing scams<\/a>. If you\u2019ve approved a malicious Optimism smart contract to be an unlimited spender of a token, your entire balance will likely be wiped out nearly instantly after the approval is confirmed.<\/p>\n\n\n\n

You grant approvals to a smart contract which is eventually compromised:<\/strong> If a contract that you\u2019ve interacted with before has a vulnerability and is hacked, the hackers may find a way to transfer all tokens from users who have previously granted token approvals to the breached contract. An example of this was the infamous Multichain bridge hack:<\/p>\n\n\n\n

Someone is exploiting this literally *right now*. If you haven’t revoked approvals yet you should probably do so before it’s too late. https:\/\/t.co\/vkjGsrUgdk<\/a><\/p>\u2014 samczsun (@samczsun) January 18, 2022<\/a><\/blockquote>