Ethereum News Update: DeFi Faces Security Turmoil as $128M Breach Sparks $1.36B Disruption
- A $128M exploit targeting Balancer's DeFi protocol triggered $1.36B in crypto liquidations and pushed ETH below $3,500. - Attackers exploited V2 vault vulnerabilities to siphon $70M+ across Ethereum , Arbitrum, and five other blockchains within minutes. - Lido and Beets Finance reported partial breaches while Aave remained unaffected, highlighting DeFi's interconnected security risks. - Market panic overshadowed recent crypto optimism , with experts warning about persistent smart contract vulnerabilities
Ethereum’s primary cryptocurrency
The breach unfolded quickly, with hackers extracting 6,587 WETH (valued at $24.46 million), 6,851 osETH ($26.86 million), and 4,260 wstETH ($19.27 million) from Balancer’s pools within minutes, according to
Balancer’s governance token, BAL, tumbled more than 15% in a single day as the community struggled with the aftermath, according to a
This exploit has brought renewed attention to the importance of smart contract security, especially for protocols managing billions in assets. Balancer, which previously experienced hacks in 2020 and 2023, now faces increased demands to fix its vulnerabilities, Yahoo Finance stated. “This should serve as a warning to the sector,” a blockchain analyst commented, pointing out that even established platforms can fall victim to advanced attacks, as reported by Yahoo Finance.
The market’s reaction was immediate and dramatic. Ethereum’s value slipped below $3,500 for the first time in months, and total crypto liquidations exceeded $1.36 billion in just one day, TradingView reported. This turmoil stands in stark contrast to the earlier optimism following a “cooler” U.S. CPI report, which had briefly sent
Balancer’s official response has so far been limited to a short post on X confirming an ongoing investigation, leaving users uncertain about recovery plans, Yahoo Finance reported. Community members are calling for greater transparency and compensation for those affected. “This is about more than just fixing code—it’s about restoring trust,” a DeFi developer remarked.
As the probe continues, the event underscores the delicate balance between innovation and security in the rapidly changing crypto world. With DeFi protocols now managing over $60 billion in assets, even small flaws can have devastating effects, CoinDesk noted. For now, the market remains tense, awaiting Balancer’s next move in what could become one of the most significant DeFi breaches to date.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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