Berachain Suspends Network After Balancer Hack Drains $129M

Balancer, a major decentralized finance (DeFi) platform, recently confirmed a large hack that stole over $129 million in crypto assets. The attack hit several networks, including Ethereum, Base, Optimism, Polygon, Sonic, and Berachain. 

However, Berachain’s quick reaction has gained the most attention in the crypto community. This event is part of a growing pattern of smart contract hacks targeting DeFi projects.

Berachain Moves Fast to Contain Damage after Major Exploit

In the immediate aftermath of the exploit, the Bera Foundation announced that validators had deliberately halted the Berachain network. The foundation said the move was necessary to prevent further damage. It also allows developers to launch an emergency hard fork to fix vulnerabilities affecting Balancer vaults and liquidity pools. 

The foundation assured users that the network will resume operations only after the recovery of affected funds. This decisive move marks one of the first times Berachain has paused block production since its mainnet activity began ramping up earlier this year.

In a recent X post, a core community figure confirmed that the Ethena team and other key partners were contacted to lock down risk vectors. Actions taken include disabling bridging out of Berachain, freezing lending markets and USDe deposits, and pausing HONEY minting and redemptions. 

The team also alerted centralized exchanges to block the hacker’s wallet addresses. Furthermore, the Bera Foundation has pledged full transparency throughout the recovery process. It stated that lessons from this incident will help shape stronger DeFi security standards on the network going forward. 

Balancer Hack Exploits Smart Contract Flaws, Drains Millions

On-chain data revealed that the attack originated from a maliciously deployed contract that manipulated Balancer’s Vault calls during pool initialization. Investigators revealed that flaws in authorization and callback handling enabled the hacker to perform unauthorized swaps. 

Notably, similar attacks have happened in other platforms such as Inch, Curve Finance, Euler Finance, and many others. These weaknesses also allowed bad actors to manipulate balance changes across affected pools. 

As a result, assets were drained from various networks, primarily Ethereum, but Berachain and several others were also affected. Tokens like WETH, osETH, wstETH, sfrxETH, and rsETH were among those stolen in the attack. 

A previously inactive whale wallet also became active, withdrawing over $7.38 million from Balancer after the hack, which made analysts more suspicious. 

Balancer Hack Triggers Crypto Market Sell-Off 

The Balancer hack shook the market, causing major price drops. BAL, Balancer’s native token, fell more than 10% and was trading around $0.897 at the time of writing. BERA, Berachain’s token, also dropped 7% to $1.69, while trading volumes jumped by over 90% as investors reacted to the news. 

The wider market was also affected, with liquid staking tokens like LDO, JTO, and RPL seeing sharp declines, and even Ethereum (ETH) falling over 4% in 24 hours to about $3,686, according to CoinMarketCap data.