The incident, first flagged by analyst Juiceberg, suggests that the tokens were minted via empty network blocks. While Harmony has acknowledged a security incident and confirmed it is developing a patch alongside potential rollback options, the team has yet to verify the specific volume of tokens involved. Juiceberg estimates that approximately 2.8 billion of the newly minted tokens were moved to exchanges, posing a significant challenge for recovery efforts.
Market reaction was swift, with trading volume spiking to $36.9 million as the price of ONE dropped toward $0.00083. The scale of the reported mint is substantial, potentially representing over a quarter of the previously reported circulating supply. This is not the first time the protocol has faced inflationary pressure from technical flaws; in 2023, a staking logic error resulted in the unintended creation of 146.3 million tokens, requiring an emergency hard fork to resolve.
Beyond the immediate technical fallout, the network faces pressure due to a long-term decline in decentralized finance activity, which had already contracted by 99% from its 2022 peak. Harmony’s ability to recover now hinges on the cooperation of centralized exchanges to intercept the flagged deposits and the effectiveness of the proposed network patch. The project has provided no public timeline for these fixes, leaving investors to await confirmation on whether a full chain rollback will be necessary to address the damage.
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