The Harmony network was shaken by a major security breach that reportedly allowed roughly 4 billion ONE tokens to be minted without authorization. The amount represented more than a quarter of the existing supply and pushed the ONE price down by about 40%. The team confirmed the attack and introduced emergency measures, while the incident renewed debate over a possible rollback and the network’s future.
On-chain data suggests the attacker exploited empty blocks to mint the tokens. With around 15 billion ONE in existence before the incident, the additional 4 billion tokens represent a sudden supply increase of roughly 26%.
Harmony releases emergency update
After conforming the attack, the Harmony team asked network operators to install an emergency software update designed to stop any further token minting. However, the team has yet to independently confirm the total number of tokens created during the exploit.
The project temporarily paused its token bridge to limit the movement of assets connected to the attack. It also asked cryptocurrency exchanges to block and freeze funds traced to four groups of addresses.
In its official statement, Harmony said it was working on a security patch and evaluating options to return the network to its pre-attack state. The technical vulnerability behind the incident remains unknown.
According to on-chain analyst Juiceberg, most of the newly created tokens were quickly transferred to centralized exchanges. The attacker reportedly has around 115 million ONE left to sell on-chain.
Possible rollback sparks debate
A rollback would return the Harmony network to a point before the attack. This could invalidate the unauthorized tokens that remain on the network.
However, the process becomes more difficult once funds reach exchanges or move to other networks. A rollback could also remove legitimate transactions unrelated to the attack from the blockchain’s accepted history.
Such a decision is therefore likely to cause disagreement among community members and validators. Reversing transactions after an attack directly conflicts with the principle of blockchain immutability.
Harmony has faced previous attacks
Harmony encountered a similar supply issue in December 2023 due to a bug in its staking system. Addresses that should have stopped receiving rewards continued to receive payments, resulting in the accidental creation of approximately 146.3 million ONE.
The network also suffered one of the crypto industry’s largest bridge attacks in 2022. Roughly $100 million in assets was stolen from the Horizon Bridge, and the FBI later attributed the attack to North Korea-linked Lazarus Group.
The latest incident differs from the previous bridge attack because it involved the creation of ONE directly on the Harmony network. The team’s technical investigation, the fate of the newly minted tokens and a possible rollback remain the main risks facing the ONE price.
