Background of the Exploit
In late September, Griffin AI’s BNB Chain bridge endpoint was compromised, allowing an attacker to mint 5 billion counterfeit GAIN tokens and launder about $3 million through Tornado Cash. The incident triggered an 84% collapse in GAIN’s market value as counterfeit liquidity flooded trading pairs across centralized exchanges.
Relaunch and Exchange Coordination
On October 6, Griffin AI announced a coordinated relaunch of the GAIN token across multiple centralized platforms. HTX, MEXC and WEEX reopened GAIN trading following a one-to-one token swap for pre-exploit holders, while Gate.io and KuCoin are scheduled to resume trading pending final announcement. The relaunch was designed as a “clean slate,” with no new token supply entering circulation to stabilize market conditions.
Recovery Measures and Buyback Fund
To restore investor confidence, Griffin AI established a $2.5 million buyback fund, matching the exploiter’s gains. Legitimate GAIN holders receive full compensation via the swap, while post-incident purchasers may claim vested allocations under a structured vesting schedule. This approach aims to mitigate losses and reaffirm trust in the project’s governance and security practices.
Future Security Enhancements
Looking ahead, Griffin AI plans to implement enhanced bridge security measures, including multi-party signature schemes and continuous auditing. The project is also exploring partnerships with security firms to offer bug bounties and integrate real-time monitoring solutions, reducing the risk of future exploits.
Industry Implications
Griffin AI’s swift response underscores the importance of robust incident management protocols in DeFi. The relaunch demonstrates that coordinated exchange partnerships and transparent compensation frameworks can effectively rehabilitate a token after a major security breach.
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