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- 4 billion ONE tokens were allegedly minted, representing about 26% of supply and triggering a steep market decline.
- Harmony is coordinating with validators and exchanges to stop further minting and freeze suspicious funds.
- ZachXBT’s criticism over unpaid investigative work has sparked a wider debate across the crypto community.
The Harmony Protocol has suffered another major security breach, with an attacker allegedly minting about 4 billion ONE tokens and triggering a sharp market sell-off. The newly created supply represented roughly 26% of Harmony’s existing token supply, putting immediate pressure on both the network and ONE’s price.
The incident comes as crypto security breaches continue to generate losses across decentralized finance and blockchain ecosystems. Harmony is now working with validators and centralized exchanges to contain the damage, while blockchain investigator ZachXBT has publicly questioned whether investigators should assist the project without compensation.
Harmony exploit floods market with newly minted ONE
The exploit was first reported after the attacker apparently used empty blocks to create approximately 4 billion ONE, according to the information provided. Around 2.8 billion of those tokens were subsequently moved toward exchanges, increasing the risk of substantial selling pressure.
Another 115 million ONE remained available for on-chain sales. That amount represented almost 3% of the fraudulently created supply.
The market reaction was immediate. ONE initially plunged more than 54%, although the decline had recovered somewhat to about 38% at press time. Open interest also climbed sharply during the sell-off, indicating increased use of short positions as traders positioned for further downside.
The incident was not reflected in DeFiLlama’s reported $12.37 million in crypto exploit losses during the first 12 days of August, according to the supplied data.
Harmony asks validators and exchanges to act
Harmony acknowledged the breach and began coordinating with exchanges in an effort to freeze suspicious funds. The team also explored patch and rollback measures while asking validators to upgrade their software to prevent additional unauthorized minting.
At the time covered by the supplied information, 53% of validators had completed the requested upgrade.
Harmony also alerted exchanges to 10,288 suspicious deposit transactions involving 409 wallets. The scale of those transactions highlights the difficulty of tracing and containing newly created tokens once they enter multiple addresses and trading platforms.
The project identified a rollback as its preferred practical response to the breach, although implementing such a measure can carry significant technical and governance implications.
ZachXBT challenges Harmony over past incident
The response has also sparked a dispute over the role of independent blockchain investigators. ZachXBT urged other on-chain researchers not to provide assistance to Harmony without compensation.
His criticism referenced the 2022 Harmony Horizon Bridge attack, which was attributed to North Korean-linked hackers. He argued that people who helped freeze funds during that incident received no financial reward despite contributing to subsequent seizures.
The position has divided the crypto community. Some users supported ZachXBT’s stance, while others argued that recognition rather than payment has traditionally accompanied investigative assistance.
The immediate focus remains on stopping further unauthorized minting, containing the movement of fraudulent ONE and determining whether a rollback can be implemented. Meanwhile, traders face heightened volatility as the market absorbs the newly created supply.
Also Read: ZachXBT Identifies 18-Year-Old in Multi-Million Dollar Bitcoin Theft Probe
The Harmony Protocol exploit underscores a persistent challenge for blockchain networks: technical vulnerabilities can quickly become market crises when attackers gain the ability to create assets at scale. For ONE holders, the outcome will depend heavily on Harmony’s containment measures, exchange cooperation and the project’s eventual decision on how to address the compromised supply.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
