- Security breach drains $42 million from GMX.
- GLP pool on Arbitrum attacked.
- 25% drop in GMX coin price.
Major decentralized exchange GMX was hit by a security breach resulting in the loss of $42 million from its GLP liquidity pool on Arbitrum, as confirmed by security firm PeckShield.
The breach highlights vulnerabilities in decentralized protocols, impacting market stability and GMX’s operation while requiring enhanced security measures in DeFi platforms.
GMX’s V1 platform on Arbitrum saw over $42 million drained, primarily affecting the GLP liquidity pool. Funds were laundered across multiple chains, as identified by PeckShield.
PeckShield reported that the attacker swapped significant assets, including USDC, ETH, and WBTC. This exploit mirrors past DeFi incidents and underscores ongoing security risks.
The GMX coin price fell by 25% following the hack, indicating significant market reaction. Trading on Arbitrum and Avalanche platforms has been temporarily disabled.
The attack severely impacted GMX’s Total Value Locked and financial stability, increasing volatility and prompting caution among cryptocurrencies investors.
PeckShield provided transaction insights, highlighting orchestrated fund obfuscation. GMX developers continue to analyze the exploit and negotiate with the attacker.
“The hacker moved funds in several stages. First, drained liquidity from the pool in USDC stablecoins. They then swapped the USDC into ETH before converting a portion of that to the DAI stablecoin. They also extracted significant amounts of FRAX, wrapped bitcoin (WBTC), wrapped ether (WETH), and multiple other tokens. These transactions were executed across various chains and included complex swaps designed to mask the movement of the funds.” — PeckShield, On-Chain Security Firm
Historically, similar attacks on DeFi protocols often lead to enhanced security protocols. GMX has no compensation strategy yet, possibly resulting in further market instability.
