Squid developers have denied involvement in a $3 million hack affecting the SquidRouterModule, clarifying it is a third-party product.
Squid developers have distanced themselves from the recent $3 million hack involving the SquidRouterModule contract, which was targeted by cybercriminals, according to reports from Blockaid.
🚨 Blockaid reported an exploit of the SquidRouterModule, impacting 86 wallets across Ethereum and Base networks, resulting in ~$3M losses in about 2 hours.
— Blockaid (@blockaid_) May 25, 2026
The breach allowed the attacker to drain funds from 86 Gnosis Safe wallets, using Tornado Cash to conceal their actions before converting the stolen assets into DAI through Uniswap V3 pools. PeckShieldAlert corroborated the attack details, revealing that the hacker initially funded their account with 2.1 ETH.
Squid clarified that the issue stemmed from a third-party Gnosis Safe integration, emphasizing that the compromised contract is not part of their core project. The SquidRouterModule is a separate smart wallet that chose to integrate with Squid's infrastructure.
"The incident is completely unrelated to our core protocol. Our users and integrators are safe and need not take any action," Squid stated.
According to the developers, the exploitation occurred because the Gnosis Safe module accepted an insecure fixed string for message verification, which led to unauthorized data calls and fund theft. The Squid router itself remains unaffected as it follows a different operational model.
"While this contract shares our name, it does not utilize our code," they concluded.
Funding and Growth
On a separate note, Squid recently announced a successful $6 million funding round led by North Island Ventures, with notable support from investors including Ripple and Dialectic. This brings the total capital raised by Squid to $13.5 million since its inception.
The platform, launched in 2023, has facilitated over 4 million transactions worth more than $6 billion and has attracted 1 million users via its app. Squid plans to implement transaction fees in the future, expanding its revenue streams from cross-chain services.
In the context of ongoing security vulnerabilities in the blockchain space, it's worth noting that just last month, another bridge exploit led to a significant loss when an attacker gained admin rights and misappropriated 1 billion DOT tokens from Hyperbridge.
