Hyperbridge has revised losses from its April 13 Token Gateway exploit to approximately $2.5 million, nearly ten times the original $237,000 estimate disclosed immediately after the incident. The supporting evidence appears in the cited X post.
The protocol published its updated findings on April 16 in a detailed post-incident report, confirming that the broader damage only became clear after forensic reconciliation across four connected EVM networks.
The initial headline figure of $237,000, representing 108.2 ETH, reflected only a partial view of what turned out to be a two-phase attack.
The full accounting adds losses from associated incentive pools and maps attacker activity across Ethereum, Base, BNB Chain, and Arbitrum, painting a significantly more damaging picture than early reports suggested.
A Two-Phase Attack That Unfolded Over About an Hour
According to the team’s official update shared on X, the attacker first extracted approximately 245 ETH directly from the Token Gateway contract. Roughly an hour later, the same attacker exploited a vulnerability in the Merkle Mountain Range proof verification logic, which allowed unauthorized minting of nearly 1 billion bridged DOT tokens.
Those tokens were then offloaded into available liquidity pools across decentralized exchanges, rapidly diluting the value of bridged DOT across all four networks.
The team described the total realized loss as denominated in both ETH and DOT at the time of the exploit, placing the combined figure at approximately $2.5 million.
The Hyperbridge team clarified that what initially appeared to be a single exploit event was actually two linked operations separated by about sixty minutes.
This distinction matters for how the industry accounts for protocol vulnerabilities: a coordinated multi-phase breach signals a more sophisticated threat actor than a one-off arbitrage or flash loan attack, and it complicates the recovery timeline for affected users.
The investigation also surfaced a secondary finding that adds complexity to the recovery effort. According to the project, a number of ordinary Hyperbridge users, distinct from the original attacker, also withdrew funds from the DOT escrow during or shortly after the incident.
The team did not specify how many users were involved or what portion of the $2.5 million total those withdrawals represent, but acknowledged the situation requires separate handling.
Binance Cooperation and a Compensation Plan Backed by BRIDGE Tokens
A significant portion of the stolen funds has been traced to Binance, according to the Hyperbridge post-incident report. The team said it is actively working with Binance’s compliance department and relevant law enforcement agencies to pursue asset freezes on the identified balances.
Recovery, however, is not expected to be quick. The team cautioned that meaningful asset recovery could take anywhere from several months to a full year, a timeline that reflects the typical pace of exchange-level compliance proceedings and cross-jurisdictional law enforcement coordination in crypto cases.
To protect affected users in the interim, Hyperbridge confirmed a compensation mechanism tied to BRIDGE, the native token of the Hyperbridge network. Should full fund recovery fall short, users impacted by the exploit will be made whole through BRIDGE token disbursements.
The specific methodology and disbursement schedule were described as still being finalized at the time of the April 16 update.
The choice to use a native token as a backstop for exploit victims is a pattern that has appeared across several DeFi protocols following major security incidents, though outcomes vary significantly depending on the liquidity and market depth of the token used.
Hyperbridge did not provide a current valuation of the BRIDGE token or a cap on how much would be allocated to compensation.
The team emphasized that the exploit remains fully contained within the Token Gateway and the affected bridged token contracts on the four EVM networks.
Core Polkadot infrastructure was not compromised, and the vulnerability was specific to the MMR proof verification logic within Hyperbridge’s own bridging layer rather than the Polkadot relay chain itself.
For the broader cross-chain bridging sector, the incident reinforces a persistent risk pattern. Bridge contracts, which must handle complex cryptographic proof systems across heterogeneous networks, continue to be among the most targeted surfaces in decentralized finance.
The Hyperbridge case adds to a long list of bridge exploits that have collectively drained hundreds of millions of dollars from the ecosystem over recent years, underscoring why proof verification logic demands the highest level of formal auditing and ongoing monitoring.
Hyperbridge has not yet disclosed a timeline for resuming full Token Gateway operations or specified which audit firms have been engaged for the post-exploit review.
Not Financial Advice: This article is for informational purposes only. Crypto investments are highly volatile. Always do your own research.
