Arbitrum-Based AFX Trade Drained of $24 Million

AFX Trade, a decentralized perpetuals exchange that runs on Arbitrum and settles in the stablecoin USDC, was drained of roughly $24.15 million on Wednesday after an attacker exploited a bridge it operates.

The exploit was not a smart contract failure. Five of the AFX’s custody bridge’s hot-validator signatures approved the withdrawal, clearing the roughly two-thirds quorum the bridge requires, according to Legalblock security chief Vladimir S.. After a 200-second dispute window, the contract released the funds as designed. The attacker then bridged the stolen USDC to Ethereum and swapped it for about 12,467 ETH, now sitting in a single wallet, according to PeckShield.

Steven Goldfeder, co-founder of Offchain Labs, which builds Arbitrum, said the native Arbitrum bridge “has not been hacked or exploited in any way.”

The loss fits the pattern that has defined crypto security in 2026: attackers targeting private keys and other off-chain components rather than the code itself. It echoes the roughly $285 million Drift Protocol loss in April, in which attackers spent months working toward privileged access, and it lands just a week after an oracle attack drained $18 million from Arbitrum-based Ostium.

Arbitrum protocols have been targeted repeatedly this year. In April, the network’s Security Council took the unusual step of freezing $71 million in ETH tied to the Kelp DAO bridge exploit, raising questions about how far a supposedly decentralized network’s emergency powers should reach. This time, the attacker’s move to Ethereum may put the funds further out of reach.

Related Listen: Why Any DeFi Protocol ‘Lives and Dies by Its Oracle’ and How to Strengthen Them

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