With the cryptocurrency market experiencing a sharp correction in early August 2024 — Bitcoin dropping below $61,000 and Ethereum falling to approximately $2,900 — the importance of proactive security management has never been more apparent. The Australian Federal Police’s Operation Spincaster recently revealed that over 2,000 crypto wallets were compromised through approval phishing scams, while the Nomad bridge exploiter resurfaced to purchase $7 million worth of discounted ETH using stolen funds. For experienced DeFi users managing positions across multiple chains, a systematic approach to token approval auditing is not optional — it is essential infrastructure. This advanced tutorial walks through building a comprehensive multi-chain approval monitoring system.
The Objective
Token approvals are the permissions you grant to smart contracts to spend tokens on your behalf. Every time you interact with a DeFi protocol — swapping on Uniswap, providing liquidity to Aave, or bridging assets between chains — you sign an approval transaction. Over time, these approvals accumulate, creating a sprawling attack surface that most users never audit. The objective of this tutorial is to build a repeatable system that identifies, categorizes, and helps you revoke unnecessary approvals across Ethereum, BNB Chain, Polygon, Arbitrum, and other EVM-compatible networks.
Prerequisites
Before beginning, ensure you have the following tools and knowledge in place. You need a Web3 wallet with access to the private key or seed phrase for each address you plan to audit. Install Python 3.10 or later with the web3.py library. Set up free RPC endpoints through providers like Alchemy, Infura, or Ankr for each chain you use. Familiarize yourself with Etherscan APIs for each network, as these provide the most reliable approval data. Finally, ensure you have a basic understanding of ERC-20 token standards and the approve and allowance functions.
For the security dashboard, you will use a combination of on-chain data queries and the Revoke.cash API, which provides approval data aggregated across multiple chains. The dashboard will consolidate this data into a single view that shows your total approval exposure, highlights high-risk approvals, and provides one-click revocation links.
Step-by-Step Walkthrough
Step one: Data collection. Start by enumerating all wallet addresses you actively use for DeFi. For each address, query the approval data from Etherscan-compatible APIs on every chain where you have positions. The ERC-20 Approval event topic (0x8c5be1e5ebec7d5bd14f71427d1e84f3dd0314c0f7b2291e5b200ac8c7c3b925) can be used to filter all approval events from the blockchain. Record the token contract, the spender contract, the approval amount, and the block number.
Step two: Risk categorization. Not all approvals carry equal risk. Classify each approval into three tiers. Tier 1 (Critical): Unlimited approvals to contracts you no longer interact with, approvals to unknown or suspicious addresses, and approvals for tokens with significant value. Tier 2 (Moderate): Active approvals to reputable protocols where the approval amount exceeds your current position size. Tier 3 (Low): Limited approvals to well-known protocols that match your current usage patterns.
Step three: Context enrichment. For each approval, pull additional data including the current token balance, the protocol associated with the spender contract (if identifiable), the time since last interaction with that protocol, and the total value at risk if the approval were exploited. This context transforms raw approval data into actionable security intelligence.
Step four: Revocation execution. For Tier 1 approvals, initiate immediate revocation. Use the standard ERC-20 approve function to set the allowance to zero for each critical spender. For gas efficiency, batch multiple revocations into a single transaction using a multicall contract. Monitor each revocation transaction to confirm successful execution before moving to the next batch.
Step five: Monitoring automation. Set up a recurring job — weekly or bi-weekly — that re-scans your approvals and flags any new ones that exceed your predefined risk thresholds. Tools like Tenderly alerting or custom webhooks can provide real-time notifications when new approvals are detected on your monitored addresses.
Troubleshooting
Common issues during the approval auditing process include RPC rate limiting when querying large numbers of events. If you encounter rate limits, implement exponential backoff with a maximum of 10 requests per second per RPC endpoint. For chains with limited API support, fall back to direct contract calls using web3.py to check allowances individually.
Some older token contracts use non-standard approval functions that do not emit standard Approval events. For these tokens, you will need to call the allowance function directly with your address and the spender address. This is slower but provides complete coverage.
When revoking approvals on Layer 2 networks like Arbitrum or Optimism, be aware that gas costs are denominated in the L2 token, not ETH. Ensure you have sufficient L2 gas tokens before initiating batch revocations. A failed revocation on an L2 can still cost gas, so verify your balances before executing.
Mastering the Skill
Approval auditing should become a regular part of your DeFi operational security routine, not a one-time exercise. After completing the initial audit, maintain a spreadsheet or database tracking your active approvals, their risk tiers, and the dates of last review. Set calendar reminders for periodic re-audits, especially after interacting with new protocols or during periods of high market volatility when exploit activity typically increases.
Consider contributing to community-maintained databases of known malicious contracts. By sharing anonymized data about suspicious approvals, you help the broader DeFi community identify emerging threats more quickly. The fight against approval phishing and smart contract exploits is collective — the more visibility we have into attack patterns, the better our defenses become.
Disclaimer: This article is for informational and educational purposes only and does not constitute financial or investment advice. Always conduct your own research and test security procedures on test networks before applying them to mainnet wallets.
building your own multi chain dashboard for approval monitoring is next level opsec. most people just use revoke.cash once and forget about it
been meaning to set up something like this. the tutorial looks solid, might fork it and add Telegram alerts for new approvals on my main wallet
revoke.cash is fine for weekly checks but building your own dashboard means you can add custom alerts for specific contracts. worth the weekend project
building your own dashboard means you actually understand what approvals do instead of blindly clicking revoke. educational value alone is worth it
revoking approvals once is security theater. you need continuous monitoring because new approvals get added every time you interact with a protocol
multisig_or_die continuous monitoring is the answer. i set up a weekly cron job that checks all my active approvals and flags unlimited ones
Operation Spincaster revealing 2000+ compromised wallets should be a wake up call. The intersection of approval phishing and market crashes is where most retail loses funds.
2000+ wallets compromised and most people still blind approve unlimited token allowances. approval phishing is the silent killer of retail funds
Emeka N spot on. unlimited approvals are a ticking time bomb. always set exact amounts or use spend limit features if your wallet supports them
exact amounts are tedious when you swap often but its the only safe default. some wallets let you set a monthly spend cap which is a decent middle ground
operation spincaster finding 2000 compromised wallets is probably the tip of the iceberg. most victims never report because they feel stupid
most victims dont even know they were drained until weeks later. approval phishing doesnt trigger any alerts, the transaction looks legit
2000+ wallets compromised through approval scams. The attack surface is way too big
Nomad resurfacing to buy stolen ETH shows attackers never really disappear