THORChain Rejects Hacker Block as Polkadot Suffers Security Breach

THORChain has refused a request from the Bitget exchange to block addresses linked to the theft of 387.5 million dollars. The decision sparked tension after Tether temporarily froze four network vaults on the Tron blockchain. The 1.45 million USDT sum was released by the stablecoin issuer just hours later.

The Polkadot ecosystem also recorded significant losses of 1.38 million dollars from its treasury. The attack exploited a security flaw that had already been patched in the code back in June. The fix was not implemented in production systems before the launch of the dotUSD stablecoin in October.

The flaw allowed the attacker to manipulate the cross-chain messaging system of the Asset Hub. The process distorted prices in the liquidity pool between DOT and dotUSD. As the sole liquidity provider, the network treasury absorbed the entire financial loss from the incident.

Reports suggest that a researcher's public disclosure regarding the code fix may have facilitated the exploit. Parity Technologies confirmed that the error was initially classified as medium severity. The reclassification to critical only occurred after the confirmation of actual financial losses.

These events highlight the fragility of decentralized protocols when faced with governance failures and system update delays. The lack of coordination between developing patches and applying them to active networks exposes allocated capital to systemic risks.