Initia halts network after $2.6M exploit

Initia halted its layer-1 network and associated rollups at 3:41 p.m. UTC on Friday. The suspension followed the identification of unauthorized token minting by security researchers. Blockchain security researcher Spreek first flagged the exploit on the same day. Initia stated it was working with security researchers, validators, and exchanges to determine the impact of the incident.

DeFi platform D2 Finance reported that the attacker exploited a vulnerability in a Move function to mint 2 million AUSD tokens. The attacker subsequently withdrew approximately 1.4 million AUSD, 105 Ether, and 1.08 million USDC to Ethereum. Onchain data indicates the stolen assets were consolidated into a single Ethereum wallet holding approximately 1,135.5 ETH, valued at $2.73 million. The total drained amount exceeded $2.6 million.

Initia is a layer-1 blockchain designed to support a network of interconnected rollups known as Minitias. The company’s native token, INIT, briefly fell to around $0.115 on Friday before rebounding above $0.15. Initia has not publicly confirmed the estimated losses or the precise cause of the exploit. Cointelegraph was unable to contact Initia for additional comment through its official X account.

The extent of the impact on users and the timeline for restoring network operations remain unclear. Initia said in a post on X regarding the halt that it is investigating the matter.