Harmony Protocol Hack: 4 Billion ONE Tokens Minted, Price Crashes 30%

Harmony Protocol has been hit by a suspected exploit that resulted in the unauthorized minting of about 4 billion ONE tokens, equivalent to roughly 26% of the token’s total supply, according to on-chain analyst Juiceberg.

The attack sent ONE down more than 30% as the newly minted tokens were moved through the network and into cryptocurrency exchanges.

How the Harmony Hack Happened

The exploit appears to have involved unauthorized minting of ONE through empty blocks, according to on-chain data cited by Juiceberg.

About 4 billion ONE was reportedly created without authorization. The amount represents roughly 26% of the token’s total supply.The newly created tokens were then moved from the addresses involved in the exploit. Around 2.8 billion ONE was reportedly transferred to cryptocurrency exchanges, where it could be sold. About 115 million ONE remained on-chain, according to the available on-chain data.

Harmony has not yet disclosed the exact vulnerability that allowed the unauthorized minting to take place. The team also has not confirmed the final amount involved.

Harmony Asks Exchanges to Freeze Funds

Harmony said it is working with its team and cryptocurrency exchanges to stop and freeze funds linked to the exploit. The project identified four groups of wallet addresses and asked exchanges to block funds traced to those addresses. The addresses include both Harmony’s ONE network addresses and Ethereum addresses linked to the movement of funds.

Harmony said it is developing a patch to address the issue and is evaluating rollback options. A rollback could allow the network to reverse or restore affected transactions, although Harmony has not confirmed whether it will proceed with one. The team said it will provide further updates as more information becomes available.

ONE Price Falls More Than 30%

The large increase in the token supply triggered heavy selling pressure on ONE. The token fell more than 30% as billions of newly minted ONE moved through the network and toward exchanges. If a large portion of the remaining tokens is sold, further selling pressure could follow.