Network Disruption Triggers Exchange Suspensions and Market Selloff
The Flow blockchain is investigating a potential security incident after abnormal onchain activity triggered a sharp decline in the value of its native token, FLOW. The event caused market volatility, emergency exchange actions, and growing concern over network security across the ecosystem.
FLOW Price Crash and Market Reaction
Following disclosure of the issue, FLOW fell more than 40% intraday, sliding from around $0.17 to near $0.10 before stabilizing slightly. Trading volume surged above $170 million within 24 hours, reflecting panic selling and heightened speculative activity.
Major South Korean exchanges suspended FLOW deposits and withdrawals shortly after the incident surfaced. In parallel, a regional exchange alliance issued a transaction risk warning, signaling that further trading restrictions could follow depending on investigative findings.
Preliminary onchain analysis suggests the incident may stem from a private key compromise rather than a smart contract flaw. Analysts observed a wallet minting millions of wrapped FLOW tokens through a proxy contract, a pattern often associated with unauthorized key access.
Losses from the incident are currently estimated at approximately $4 million. As a precaution, bridges and liquidity pools were paused to prevent further damage while the investigation continues.
Flow, a Layer 1 network built for consumer applications and digital collectibles, rose to prominence during the NFT boom. However, the latest incident highlights ongoing security challenges facing blockchain infrastructure, particularly as private key attacks remain a dominant threat across the industry.
Further updates are expected as the investigation progresses.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.