StakeWise has taken swift action following a major decentralized finance exploit that sent shockwaves through Balancer and several connected networks this week.
Summary
- StakeWise has recovered 73.5% of stolen osETH worth approximately $19 million from the Balancer hacker.
- The exploit cost more than $128 million by taking advantage of a Smart Contract flaw in Balancer.
- The recovered funds will be returned to the affected users based on their pre-operation balance.
StakeWise has recovered most of the assets stolen in the recent Balancer exploit, marking a rare success in the wake of one of the largest decentralized finance attacks of the year.
In a post on
The recovery represents 73.5% of the 6,851 osETH drained during the attack. The remaining 26.5%, worth an estimated $7 million, was quickly converted into ETH by the attacker and could not be retrieved.
StakeWise said the recovered funds will be returned to affected users on a pro-rata basis based on their pre-operation balance. A full post-mortem and next steps will be published shortly.
Balancer hack cost over $128 million across networks
The Balancer hack exploited a flaw in the manageUserBalance feature of the V2 Composable Stable Pools, allowing the attacker to make unauthorized withdrawals. Due to the vulnerability, it was possible to manipulate internal balances and convert Balancer Pool Tokens into underlying assets such as Ethereum.
The attack quickly spread across multiple layer 2 networks, including Arbitrum, Base, Polygon, Optimism, Berachain, and Sonic, which share parts of Balancer’s codebase. Blockchain analytics firms PeckShield and Lookonchain later reported that the total loss was more than $128 million, compared to initial estimates of around $70 million.
The attacker consolidated stolen tokens into several wallets and began converting portions into ETH, raising concerns about money laundering through mixers and bridges.
Balancer and partners respond
Balancer quickly paused the affected pools and entered ‘recovery mode’. The team issued a notice to the chain offering the attacker a 20% white hat bounty worth approximately $25.6 million for the return of the money within 48 hours. They also warned users about scams impersonating Balancer’s team during the crisis.
Several interconnected protocols, including Gnosis, Berachain and Beefy, also temporarily halted operations to limit the impact. The exploit, Balancer’s largest to date, contributes to a rising number of DeFi breaches in 2025.
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