Loopscale Recovers $2.8M in Weekend DeFi Exploit as Bounty Talks Advance

Loopscale Recovers $2.8M in Weekend DeFi Exploit as Bounty Talks Advance

White-hat negotiations yield partial recovery after $5.7 million hack hits USDC and SOL vaults

In the fast-moving world of decentralized finance, few things strike fear like a sudden exploit. That fear became reality for Loopscale over the weekend, when the DeFi protocol suffered a $5.7 million attack. But in an unexpected turn, Loopscale has already recovered $2.88 million, thanks to ongoing bounty negotiations with the hacker.

Hacker Returns Nearly Half of Stolen Funds

Loopscale confirmed on April 29 that 19,463 Wrapped SOL (WSOL) had been returned to its wallets since the exploit occurred. The returns came in three separate batches:

• 10,000 WSOL (~$1.48 million)

• 4,463 WSOL (~$660,000)

• 5,000 WSOL (~$740,000)

“Our pursuit of an amicable resolution regarding Saturday’s incident continues to make progress,” the Loopscale team said in a public post.

The Exploit: Token Manipulation Leads to Vault Drain

The attack took place on April 26, when the protocol’s RateX PT token pricing mechanism was manipulated. This allowed the attacker to drain both its USDC and SOL vaults, resulting in the loss of:

• $5.7 million total

• Including USDC and 1,200 SOL tokens

This theft represented 12% of Loopscale’s total assets and affected only vault depositors, not borrowers or leveraged users (“loopers”).

Bounty Offer and Hacker Response

On April 27, Loopscale publicly offered a 10% bounty to the hacker in exchange for the return of 90% of the funds, along with full release from liability. The team stated it would escalate the issue to law enforcement if no agreement was reached within 24 hours.

By April 28 at 3:52 p.m. ET, the hacker responded, expressing willingness to negotiate. That response paved the way for the current round of returns.

A Broader Trend in DeFi Security?

Recovering funds after an exploit is rare in decentralized finance, but recent months suggest a slight shift. Term Finance, for example, disclosed last week that it had recovered $1 million of a $1.6 million loss, including 223 ETH reclaimed internally and 333 ETH returned via negotiation.

Still, the bigger picture remains grim. In Q1 2025 alone, hackers stole over $1.6 billion in crypto assets, according to security firm PeckShield. A staggering $1.5 billion of that total came from a single attack on the centralized exchange Bybit, reportedly linked to the North Korean Lazarus Group.

Conclusion: Negotiations Offer a Glimmer of Hope in DeFi’s Ongoing Battle with Exploits

While Loopscale’s recovery of $2.8 million offers some relief, it also underscores the vulnerabilities still plaguing decentralized finance platforms. With $5.7 million lost in one exploit and over $1.6 billion stolen in Q1 alone, the industry is in a high-stakes game of trust and risk. Whether bounty negotiations become a sustainable defense mechanism remains to be seen.