Initia halts layer-1 network and rollups after reported exploit moved over $2.6 million to Ethereum

News Editor

2026-10-23 18:39:02

Initia suspended its layer-1 blockchain and connected rollups on Friday after a reported security incident that researchers said let an attacker mint tokens without authorization and move more than $2.6 million in crypto assets. The network said the halt took place at 3:41 p.m. UTC and that it was working with security researchers, validators and exchanges to assess the damage. Security researcher Spreek first flagged the incident, saying unauthorized minting had already been used to convert roughly $2.6 million into other assets, with more funds still in motion at the time. D2 Finance later said the attacker exploited a vulnerability to mint 2 million AUSD without sufficient backing, then bridged about 1.4 million AUSD, 105 ETH and 1.08 million USDC to Ethereum. According to D2 Finance, the stolen funds were later consolidated into an Ethereum wallet holding about 1,135.5 ETH, worth roughly $2.73 million. Initia has not publicly confirmed the estimated losses or the exact cause of the exploit, and it has not said when network operations may resume. Cointelegraph said it was unable to obtain additional comment from the project through its official X account.

Initia halted its layer-1 blockchain and rollups on Friday after security researchers reported an exploit that allegedly allowed an attacker to mint tokens without authorization and move more than $2.6 million in crypto assets to Ethereum.

In a post on X, Initia said the network was stopped at 3:41 p.m. UTC following a security incident. The team said it was working with security researchers, validators and exchanges to determine the full scope of the impact.

Researchers traced unauthorized minting and cross-chain transfers

Blockchain security researcher Spreek first flagged the exploit on Friday. He said an attacker had minted tokens without authorization and converted about $2.6 million into other assets, while additional funds were still being moved.

DeFi platform D2 Finance later said the attacker exploited a vulnerability to mint 2 million AUSD without sufficient backing. It said the attacker then used cross-chain transfers to withdraw about 1.4 million AUSD, 105 Ether (ETH) and 1.08 million USDC (USDC) to Ethereum.

D2 Finance said the stolen assets were later consolidated into an Ethereum wallet holding about 1,135.5 ETH, valued at roughly $2.73 million. The firm attributed the incident to a vulnerability in a Move function that let the attacker create unbacked tokens and swap them for assets on Ethereum.

Loss estimate and restart timeline remain unconfirmed

Initia is a layer-1 blockchain built to support a network of interconnected rollups known as Minitias. Its native token, INIT, briefly fell to around $0.115 on Friday before recovering above $0.15, according to CoinGecko data. At the time of writing, INIT was trading near $0.1496, up about 14% over the previous 24 hours.

Initia has not publicly confirmed the estimated losses or the precise cause of the exploit. The extent of the impact on users also remains unclear, and the project has not provided a timeline for restoring network operations. According to Cointelegraph, it was unable to reach Initia for additional comment through the project’s official X account.

This article was originally published by Bit.Fan. For more cryptocurrency news and market insights, visit www.bit.fan.

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