MANTRA halted its Layer 1 blockchain late Thursday after what the team said was an incident in the Cosmos EVM module of MANTRA Chain. By Friday morning, the company said it had found the root cause and contained the threat, though the network remained offline.
The company disclosed the halt at 8:10 p.m. ET on Aug. 20, saying all endpoints and transactions had been frozen and that it had neither a root cause nor a timeline to share at that point. Roughly nine and a half hours later, MANTRA posted that 「the incident was isolated to the Cosmos EVM module of MANTRA Chain and affected two wallet addresses before we achieved containment,」 adding that 「no user funds were exploited」 and that chain resumption was 「potentially targeted within the day.」
Its status page added a narrower description. The two affected addresses were identified as 「MANTRA-managed wallets,」 and the team said it had 「no indication that user, exchange, or partner funds were affected.」 MANTRA has not disclosed the amount involved, named the flaw, or said whether any assets moved out of the two wallets. A post-mortem has been promised.
Settlement on the chain is still paused
The freeze has stopped settlement on a network built to hold regulated real-world assets. In May, MANTRA said Securitize, the tokenization platform behind BlackRock’s BUIDL, had joined its active validator set.
The chain also hosts mantraUSD, a stablecoin that MANTRA says is backed by short-term U.S. Treasuries. It also supports a Layer 2 that borrows MANTRA’s security. The outage came while Inveniam Capital Partners was still working to close its acquisition of the company.
Token hit a record low before the halt was disclosed
According to CoinGecko data, the MANTRA token, renamed from OM in a 1:4 redenomination that took effect in March, fell to an all-time low of $0.0041 at 23:09 UTC on Aug. 20. That was about an hour before the company disclosed the chain halt. Four hours earlier, the token had traded at $0.0050.
By 14:00 UTC on Friday, it had recovered to $0.0048, still down roughly 4% over 24 hours. Its market capitalization stood at $26.9 million, while 24-hour trading volume reached $30.3 million. The token remained 82% below its March 4 high of $0.0263.
Only limited onchain value was sitting on the network
DefiLlama data showed MANTRA’s tracked DeFi total value locked at $548,575 on Aug. 20, including $468,411 in stablecoins. By Friday, DefiLlama’s reading for the chain had dropped to $5,159 during a period in which no MANTRA transactions had settled.
Second Cosmos EVM-related security event in seven months
This is the second time in seven months that MANTRA has been pulled into a security event tied to the Cosmos EVM codebase, the shared open-source stack used to give Cosmos SDK chains Ethereum compatibility. MANTRA switched its EVM on in September 2025.
In January, an attacker drained roughly $7 million from Saga’s EVM network through a bug in the ICS20 precompile, according to Cosmos Labs’ ASA-2026-002 advisory. State changes made during recursive calls were not reflected in the outer execution context, allowing the same token balance to be spent more than once in a single transaction.
Cosmos Labs said 15 chains were running the affected code. Six had not enabled the feature, one was exploited, and the rest applied mitigations before being hit. A permanent fix shipped in March.
MANTRA has not said whether this week’s incident involved a precompile, nor has it disclosed which version of the Cosmos EVM stack its mainnet was running. The cosmos/evm repository has not published any advisory since March.
Incident lands during acquisition process
Inveniam Capital Partners said in June that it planned to acquire MANTRA and its affiliates. The firm said the deal was expected to close in the third quarter, subject to customary conditions. Terms were not disclosed.
Inveniam had invested $20 million in MANTRA in August 2025, and the two also built NVNM Chain, a Layer 2 that MANTRA says inherits security from MANTRA Chain through Interchain Security.
MANTRA operates the chain under a Virtual Asset Service Provider license from Dubai’s Virtual Assets Regulatory Authority. The company is smaller than it was a year ago. In January, it cut staff across business development, marketing, HR, and support, nine months after OM plunged 93% in 20 minutes and wiped out about $5 billion in market value.
Patched release is still being tested
The team said it is validating a patched release on its DuKong testnet and coordinating a restart with validator partners. It has not committed to a restart time until testing is finished.