Arbitrum-based AFX Trade drained of $24 million after bridge keys compromised

TechArbitrum-based AFX Trade drained of $24 million after bridge keys compromisedSecurity firms said the attacker used enough hot-validator signatures to approve a 24.15 million USDC withdrawal, while Arbitrum said its native bridge was not affected.By Shaurya MalwaUpdated Jul 23, 2026, 5:16 a.m. Published Jul 23, 2026, 5:01 a.m. 2 min readMake preferred on ShareShare this articleCopy linkX iconX (Twitter)LinkedInFacebookEmailMake preferred on SummaryShowAFX Trade, a decentralized perpetuals exchange on Arbitrum that settles in USDC, was drained of about $24.15 million after an attacker compromised validator signing keys for a bridge the protocol operates.Arbitrum’s native bridge was not breached, and security firm Blockaid said the on-chain logic functioned as designed, with five hot-validator signatures meeting the quorum needed to authorize the withdrawal.The attacker moved the stolen USDC to Ethereum and swapped it for roughly 12,467 ETH, nearly emptying AFX’s total value locked amid a broader wave of high-profile crypto hacks on Arbitrum-based protocols.Another week, another multi-million-dollar hack in DeFi, and once again, it’s an off-chain compromise rather than a smart contract exploit.AFX Trade, a decentralized perpetuals exchange that settles in dollar-pegged stablecoin USDC, was drained of about $24.15 million on Wednesday after an attacker compromised the validator signing keys behind a bridge the protocol operates on Arbitrum, blockchain data shows.In other words, the smart contract did what it’s supposed to do – verify the signature and execute the transaction. The problem was with the private keys that generated those signatures, as attackers compromised the private validator signing keys (hot keys held offchain by the bridge operators or validators).Steven Goldfeder, co-founder of Offchain Labs, which develops and maintains the network, said the Arbitrum native bridge "has not been hacked or exploited in any way" and that the transaction originat…

Arbitrum-based AFX Trade drained of $24 million after bridge keys compromised

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