Initia paused its Layer 1 chain and connected rollups on Friday, October 23, after the team confirmed a security incident. Co-founder Ezaan Mangalji said preliminary findings point to a previously unknown, or Day 0, bug in the network’s MoveVM implementation on the Cosmos SDK, which allowed an attacker to mint tokens without authorization.
Mangalji estimated that the attacker minted and bridged out about $2.7 million in AUSD, ETH and USDC before the halt. The official account has not confirmed the final loss, and the full impact is still being determined. He said the bug does not affect the native INIT token.
Other parties moved quickly. Agora, the issuer of AUSD, said it has no smart contracts on Initia, that AUSD does not exist on the chain and that its operations are unaffected, and that it will freeze funds tied to hacker addresses on chains where its contracts are deployed. South Korean exchange Upbit suspended INIT deposits and withdrawals.
INIT initially fell about 14% on the news, then recovered and traded higher on the day, according to reports. Initia says it is working with security teams, validators and exchanges to establish the scope of the breach. It has not announced when normal operations will resume.
The next steps to watch are the identification of the vulnerable code path, a reconciliation of minted assets against those that left the network, and an explanation of the patch and any validator upgrade.
Track the market yourself with AiTraderView’s free tools: Crypto Cockpit for charts and 75+ indicators, Crypto Screener to find setups, and Crypto Portfolio to follow your holdings.
Sources:
- Bitcoin.com News: Hacker Prints $2.7M in Crypto as Initia Blockchain Grinds to a Halt
- FinanceFeeds: Initia Halts Network After Day 0 Bug Enables Unauthorized Token Minting
⚠️ RISK WARNING & AI DISCLOSURE
- This information is generated by Artificial Intelligence (AI) and complex algorithms. While advanced, these systems can contain errors or inaccuracies and are for educational purposes only.
- Technical analysis provides no guarantees; this information is purely informative.
- All discussed scenarios are hypothetical and do not constitute predictions or expectations.
- Past performance is not an indicator of future results.
- This is not financial advice and is not intended as a call-to-action for the reader.
- No implicit direction is claimed, and no specific behavior of market participants is suggested.