AFX Trade on Arbitrum Loses $24M in Hack, Proposes Bounty to Attacker

AFX Trade Hack Overview

AFX Trade, a decentralized perpetual trading platform on Arbitrum, has reported a significant security breach resulting in the loss of approximately $24.15 million. The incident was linked to an exploit of the USDC custody bridge managed by the protocol, as confirmed by security firm Blockaid.

Following the attack, AFX Trade promptly suspended operations on the affected bridge and is currently investigating the specific methods utilized by the hacker. Initial on-chain tracking indicates that the stolen USDC was converted to Ethereum, resulting in the acquisition of about 12,468 ETH, which is now held in a single wallet.

“We are aware of an incident involving the USDC custody bridge operated by AFX on Arbitrum. Immediately upon detection, we suspended bridge operations and began our incident response protocols,” stated AFX Trade in a recent tweet.

Response and Investigation

Arbitrum co-founder Steven Goldfeder clarified that the breach did not affect the network’s native bridge and originated from an external protocol. This distinction is crucial, as an exploit of Arbitrum's own infrastructure would have had wider repercussions.

In an effort to resolve the situation, AFX has publicly proposed a deal to the hacker: return 70% of the stolen funds and retain the remaining 30% as a "white hat bounty." This type of offer has become increasingly common in the cryptocurrency space, echoing similar proposals made after other high-profile hacks, including a recent incident involving the Drift Protocol on Solana.

Broader Implications for DeFi

This incident highlights a concerning trend in decentralized finance (DeFi), which has seen over $840 million in losses due to hacks in 2026 alone. Notably, just a week before the AFX attack, another Arbitrum-based platform, Ostium, lost $18 million due to a compromised oracle key, underscoring the vulnerabilities within the ecosystem.