In late July, at least three cross-chain bridges and protocols were exploited in a span of roughly six hours, with combined losses exceeding $35 million. The largest single hit was AFX, a perpetuals venue running a bridge on Arbitrum, which lost about $24.15 million. The attacks underscore the persistent vulnerabilities in the infrastructure that moves assets between blockchains.
How the attacks unfolded
Details remain scarce, but investigators say the three incidents appear to be separate rather than a single coordinated exploit. Each targeted a different bridge or protocol that relies on wrapped assets — tokens that represent a claim on an asset locked on another chain. In AFX's case, the attacker drained the bridge contract, siphoning off wrapped versions of ether and stablecoins. The other two victims have not been publicly named, but the total stolen across all three is estimated at $35 million to $40 million.
Wrapped asset risks exposed
Wrapped assets are essentially IOUs: users lock a native token on chain A, and a bridge mints a corresponding token on chain B. The system depends on the bridge's security to keep the locked funds safe. When a bridge is compromised, the wrapped tokens can become worthless if the attacker drains the reserve. That can trigger a depeg — the wrapped token trades at a discount to its underlying asset — because holders fear they can no longer redeem it 1:1.
A depeg can cascade into liquidations. If a wrapped token is used as collateral in lending protocols, a sudden price drop forces borrowers to repay or get their positions closed. That selling pressure can push the price down further, creating a loop. The July attacks did not cause a widespread market panic, but they reminded traders that bridge risk is far from solved.
AFX has paused its bridge and is working with security firms to assess the damage. The other two protocols have not issued public statements. Users who held wrapped assets on those bridges are waiting to see if any recovery is possible — often a slow and uncertain process. The broader DeFi ecosystem is watching for any signs of contagion, especially if the stolen funds were borrowed against.
For now, the industry is left with the same question it has faced after every major bridge hack: how to build cross-chain infrastructure that doesn't create a single point of failure.
