Explaining Shibarium’s ‘damage control mode’ after $2.4M exploit

Key Takeaways

What happened to Shiba Inu’s Shibarium network?

Shibarium suffered a $2.4 million flash loan exploit that targeted its cross-chain bridge and compromised 10 out of 12 validators.

How did the Shibarium bridge exploit impact tokens?

SHIB slipped to $0.00001301 after a 6.28% daily loss, BONE crashed 38% to $0.1928, and KNINE fell 4.28% to $0.052557.

As we all know, Shiba Inu’s Layer-2 network, Shibarium, recently came under fire after its cross-chain bridge fell victim to a $2.4 million flash loan exploit on the 13th of September.

The attack compromised 10 out of 12 validators, siphoning off Ethereum [ETH] and Shiba Inu [SHIB] tokens.

The offered bounty program

In an unusual move to recover the stolen funds, Shibarium’s DeFi platform has extended a peace offering.

K9 Finance DAO posted a 5 ETH bounty to the attacker. Return of K9 Finance [KNINE] would settle via the deployed contract. The offer expires in 30 days and starts shrinking after seven.

Shiba Inu developer Kaal Dhairya noted, 

“Once secure key transfers are completed and validator control integrity is verified, the stake manager funds will be restored in full. Our top priority is protecting the network and community assets.”

He further added,

“We are currently in damage control mode and do not yet know if the breach originated from a server or a developer machine.”

The fallout from the Shibarium bridge exploit rippled across the Shiba Inu ecosystem, sending associated tokens into the red.

Prices slide across ecosystem

According to CoinMarketCap data, SHIB was trading at $0.00001301 at press time, marking a 6.28% decline in the past 24 hours.

Other ecosystem tokens were not spared either.

Bone ShibaSwap [BONE] saw sharp volatility, initially spiking to $0.294 in the immediate aftermath of the exploit before sliding back to $0.2057.

The decline continued, with BONE posting a 38% drop since the 14th of September, tumbling from $0.31 to $0.19, and further dipping 4.89% in the past day to trade at $0.1928.

Meanwhile, the K9 Finance (KNINE) token also recorded losses, changing hands at $0.052557 after shedding 4.28% over the last 24 hours.

Forensics and next steps

Shiba Inu’s team engaged Hexens, Seal 911, and PeckShield for investigation. They remained in damage control while confirming any validator key compromises.

Once secure key transfers finish, stake-manager funds will be restored. Traders watched for further updates before resetting risk.