Injective Suspends Network for About 4 Hours After Binary Options Exploit

Injective paused operations for about four hours on September 1 after a binary options vulnerability was exploited, according to X user Paddy-earthling. According to PANews, the attacker used a deprecated but still registered oracle called Frontrunner to steal about $4.9 million. Paddy-earthling said the oracle’s data source had already been cleared, but the attacker created 299 markets pointing to it. Because prices could not be obtained, the protocol triggered a “no price refund” mechanism, which the attacker used to receive roughly double compensation. The attacker then converted USDC into about 1,980 ETH and moved the funds to an Ethereum wallet that has not sent any transactions. Paddy-earthling also said Injective’s official X account continued posting marketing content after the attack and did not mention that the chain had been paused. The post said Injective had made its core chain code private, but the vulnerability was found through the public SDK, which excluded white hats and auditors. The protocol-level funding gap has been filled, but the fix was made without a governance vote or public explanation, and it cannot be verified. The attacker has consolidated all funds in one wallet and has not moved them, while reportedly weighing a white-hat settlement offer. The author disclosed holding a long position in INJ.