Initia Suspends Network After $615,000 Asset Theft

The Initia network suspended its layer-1 blockchain after detecting unauthorized transfers from custody accounts. The incident resulted in the loss of approximately $615,000 in digital assets before the system was fully shut down.

Preliminary investigations suggest the attacker used compromised rollup infrastructure keys to forge transfers via the IBC protocol. The stolen funds include $605,000 in USDC and $10,000 in various other tokens. The technical team halted network operations at 06:18 UTC to stop further transactions.

The project faced a similar security issue less than three weeks ago. At that time, an attacker exploited a vulnerability in the MoveVM cache system to create unbacked balances, resulting in a $2.7 million loss. The foundation responsible had approved funds to restore the affected balances before this new episode occurred.

Initia's team stated that most of the assets moved from the custody accounts remain trapped on the layer-1. Developers are working to identify the full extent of the flaw and restore normal network operations. The recovery process now depends on technical analysis of the compromised keys and the integrity of the produced blocks.