Shiba Inu's SHIB Drops 4% Amid Shibarium Exploit Attempt

Shina Inu's latest price was $0.06, down 3.997% in the last 24 hours. The Shiba Inu ecosystem faced heightened scrutiny this week after an attempted exploit on its Layer-2 blockchain bridge, Shibarium. Initial reports earlier on Saturday framed the incident as a “hack,” prompting alarm across the community. However, developers have now clarified that the Shibarium protocol itself was not compromised. According to Shibarium developer Kaal Dhariya, the attack involved a flash loan that allowed the perpetrator to acquire 4.6 million BONE tokens. The attacker then used stolen validator signing keys to gain temporary majority control, enabling them to push a malicious state on the bridge. While the attempt was sophisticated, developers emphasized that core infrastructure remained intact. Dhariya noted that the staked BONE tokens remain locked due to unstaking delays, giving the team a critical opportunity to secure them. The Shibarium Bridge is a vital component of the Shiba Inu ecosystem. It allows users to transfer assets, such as SHIB, BONE, LEASH, and wETH, between Ethereum and Shibarium. By offloading activity from Ethereum’s mainnet, Shibarium reduces transaction fees, increases speed, and enhances usability for decentralized finance (DeFi) applications, gaming, and metaverse projects. In response to the exploit attempt, the Shibarium team temporarily paused staking and unstaking functions. They also transferred validator funds into a secure hardware wallet managed by a trusted 6-of-9 multisignature setup. Investigations are ongoing to determine whether the validator keys were compromised through a server breach or a developer’s machine. Meanwhile, leading blockchain security firms are actively collaborating with the team to prevent further risks and restore confidence. Despite the attempted exploit, Shiba Inu’s native token SHIB has held firm. Market watchers believe the renewed attention on Shibarium may have contributed to the rally. BONE plays a crucial role within the ecosystem, allowing holders to vote on governance proposals, earn rewards through staking, and support liquidity on ShibaSwap. Its sudden surge signals that investors view the exploit as contained rather than catastrophic. To calm community fears, Shibizens, the official communication channel for Shiba Inu, issued a detailed Q&A update addressing investor concerns later in the day, noting that Shibarium hadn’t been hacked. They confirmed that only a small amount of ETH and SHIB was affected, while the bulk of assets, including the 4.6 million BONE at the center of the exploit, remain frozen. Validator keys are being replaced, and once integrity checks are complete, full functionality will return. The developers stated that their top priority is protecting the network and community assets, promising ongoing transparency as remediation continues.

Lead Shiba Inu developer Kaal Dhairya described the incident as a “sophisticated” attack likely planned for months. He mentioned that the team has contacted law enforcement but is open to negotiating a bounty if the attacker returns the funds. Security firms have been enlisted to investigate the exploit. The use of outside security firms is notable. The exploit triggered wild price swings in Shibarium tokens. Despite the volatility, SHIB’s market capitalization remains above $10 billion, keeping it among the top 20 cryptocurrencies by size. Shibarium, launched in 2023 as a scaling solution for the Shiba Inu ecosystem, relies on validator consensus to secure its bridge to Ethereum. The exploit underscores vulnerabilities in governance-token-based security models, where flash loans can temporarily concentrate power. The Layer 2 network was designed to reduce Ethereum gas fees for SHIB holders and has processed more than 110 million transactions since launch, but Friday’s attack highlights how validator manipulation remains an Achilles’ heel in proof-of-stake and DAO-governed systems. The developers said they are rotating validator keys and hardening security before restoring normal operations. According to Dhairya, the incident will delay several planned upgrades, including Shibarium’s integration with ShibaSwap V2, as resources are redirected to reinforcing bridge security.

A new Shiba Inu whale withdrew 512.6 billion SHIB from Kraken into a fresh wallet, per on-chain Arkham data. The address now holds almost all its $7.1M balance in SHIB and 5 ETH, signaling large-scale accumulation during a short-term price dip. The Shiba Inu whale withdrawal is an on-chain transfer of 512.6 billion SHIB from Kraken hot wallets into a newly created address labeled “0x2CC.” The move concentrated a large block of SHIB off-exchange during a price decline, altering short-term liquidity dynamics for the token. Arkham on-chain analytics identified the single large transfer from Kraken’s hot wallets to one fresh address. The receiving wallet now shows almost its entire balance in SHIB plus 5 ETH. On-chain tags and flow comparisons indicate this inflow outpaced most daily exchange withdrawals for SHIB. Removing half a trillion SHIB from Kraken compresses immediate sell liquidity on that exchange. Because the transfer occurred during a price drop, it looks less like a liquidity-driven sell and more like deliberate accumulation, which can be interpreted as a bullish signal if the holder intends long-term holding. The withdrawal size is larger than many daily exchange volumes for SHIB, instantly ranking the receiving wallet among top holders and making the token more sensitive to large sell orders on exchanges. Traders should treat the event as a liquidity and sentiment data point, not a standalone price predictor. Combine this on-chain evidence with order book depth, open interest in derivatives, and broader market conditions before adjusting positions. The recorded transfer totaled roughly $7.14 million in SHIB at the time of the move, plus a separate 5 ETH balance, as shown by Arkham on-chain data. As of the latest on-chain update, the wallet labeled “0x2CC” has not moved the newly accumulated SHIB, indicating a one-sided holding pattern that may reflect longer-term intent.

The Shiba Inu ecosystem continues to demonstrate development momentum, with a key event on September 14 involving the Shibarium protocol. The Shiba Inu development team officially confirmed that the layer-2 solution Shibarium was not compromised despite online rumors suggesting an attack, providing reassurance to the community regarding the security and integrity of their infrastructure. Parallel to the team's security confirmation, significant acquisition activity involving Shiba Inu tokens has been observed. Market analysts note that large holders, often referred to as "whales," executed substantial transactions, with reports indicating a $135 million SHIB purchase. Such activity reflects ongoing interest from major participants within the Shiba Inu network, focusing on the project's long-term potential rather than short-term fluctuations. Looking beyond immediate events, broader technical analysis and community discussions suggest a potential resurgence in interest surrounding the Shiba Inu ecosystem. While specific price trajectories are excluded per the requirement, technical indicators and whale behavior are interpreted by some observers as potentially positive signals for the network's future activity and adoption, fueling long-term speculation about its evolution within the crypto landscape over the next decade and more. The Shiba Inu project's narrative is progressively shifting towards emphasizing its ecosystem's utility and development progress. There's a growing discourse around the actual applications being built and tools being deployed on Shibarium and within the broader Shiba Inu environment, moving beyond initial memecoin origins. Analysts highlight this trend, suggesting that solving real-world challenges through its developed protocols could be a significant focus for Shiba Inu throughout 2025 and into subsequent years.