$782K Hyperliquid Exploit Highlights Persistent DeFi Smart Contract Risks

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A smart contract flaw has led to a $782,000 exploit on Hyperdrive, a lending protocol on the Hyperliquid L1 network. This incident marks the third notable security breach on the popular network, underscoring the ongoing risks in the DeFi sector.

The attacker leveraged an “arbitrary call” vulnerability in the protocol’s router to drain funds from two key markets before converting and moving the assets off-chain.

While the Hyperdrive team has since paused operations and pledged full compensation for victims, the exploit serves as a stark reminder of the technical perils that remain in decentralized finance. The protocol remains offline pending a full investigation and the release of a postmortem.