TLDR
- Shiba Inu froze 4.6M BONE after a flash loan exploit targeted Validator 1.
- SHIB paused staking and moved validator funds to a multisig hardware wallet.
- PeckShield flagged the breach; the SHIB team started a full security investigation.
- BONE token price surged over 40% within 24 hours after the emergency freeze.
Shiba Inu developers have frozen 4.6 million BONE tokens after a security firm raised concerns about a possible exploit targeting the Shibarium bridge. The warning, flagged by blockchain security company PeckShield, led to immediate action from the SHIB team to secure the ecosystem.
The freeze comes during an ongoing push for security improvements and upgrades across the Shiba Inu ecosystem, including validator reviews and token migrations.
Security Firm Flags Exploit; Team Acts Quickly
PeckShield alerted Shiba Inu developers to suspicious activity linked to the Shibarium bridge. The report indicated a potential flash loan exploit that involved BONE token purchases. Shortly after the alert, Shiba Inu developer Kaal Dhairya confirmed the team was investigating the incident.
According to the update, attackers used the exploit to obtain 4.6 million BONE tokens. They did this by compromising validator signing keys. This gave them control over Validator 1, which allowed them to attempt to drain assets through the Shibarium bridge. Since the tokens were staked through Validator 1, they remained locked due to staking rules. This allowed the developers to freeze them before they could be moved or sold.
Emergency Measures and System Review Underway
As a precaution, Shiba Inu developers paused staking activities and transferred validator funds to a hardware wallet. This wallet is now secured using a multisig setup. The team also launched a review of all validator signing keys to ensure they had not been tampered with.
The developers said protecting user assets remains the top concern. Dhairya stated, “We took immediate action to protect community funds and are working with partners to understand the breach.”
Shiba Inu has involved external security partners in the investigation, including Hexens, Seal 911, and PeckShield. Law enforcement agencies have also been notified. The developers offered to negotiate with the attacker and promised no legal action if the stolen funds were returned.
Shibarium Bridge Plays Key Role in Ecosystem Growth
The Shibarium bridge is a vital part of Shiba Inu’s Layer-2 plans. It allows users to move tokens such as SHIB, BONE, and LEASH between the Ethereum and Shibarium chains. The bridge is designed to cut transaction fees and improve transfer speeds.
It also supports the project’s move into DeFi, gaming, and digital assets. The breach raised concerns about the bridge’s reliability, but the SHIB team said upgrades are ongoing to improve its resilience.
The incident comes shortly after another warning was issued to the community. Scammers were using expired Discord links to lure users into fake servers. Victims were tricked into verifying their wallets, which drained their assets.
LEASH V2 Migration and ShibaSwap Upgrade Continue
During the investigation, the team also provided updates on ongoing development. The migration to LEASH V2 is in progress, and a fixed ratio model will be used. This approach will help users swap their LEASH V1 tokens without confusion or manual steps.
In addition, ShibaSwap has launched a significant upgrade. The update focuses on cross-chain support and better liquidity control. These changes are part of the larger plan to position Shiba Inu more strongly in the DeFi space.
Despite the breach, the market response has been positive. Following the freeze of the stolen BONE tokens, the price of BONE increased by over 40% in 24 hours, according to data from TradingView.
