Cronos Halted After Estimated $75M Tectonic Crypto Hack

The Cronos network halted block production after a Tectonic crypto hack affected an estimated $75 million in assets. Independent researcher Weilin Li said that the attacker exploited TONIC, Tectonic's governance token, which had a 20% collateral factor and traded with limited liquidity during the attack. The attacker pushed TONIC's price roughly 100-fold within about 20 minutes, then deposited inflated tokens and borrowed other assets from Tectonic.

The attacker allegedly purchased about 16 trillion TONIC across three VVS liquidity pools using around $600,000 in USDC and CRO, lifting TONIC's price by about 40%. The attacker then deposited those tokens into Tectonic, along with approximately $5 million in USDC. After two test loans, the attacker executed one transaction involving roughly $120 million, which allegedly drew USDC, USDT, WBTC, WETH, and CRO from Tectonic's lending markets.

Researcher Awoo estimated that the attacker committed about $5.6 million of personal funds during the operation, with copycat traders later extracting around $2 million. Cronos validators halted block production after discovering that approximately $66 million in assets were affected by the hack, with Li initially estimating that around $8 million reached Ethereum before the halt.

Around $60 million remained at a Cronos address after the chain stopped processing transactions, with an additional $8 million found in another address. The assets remaining on Cronos following the hack incident have not been confirmed as recovered by either project. This comes as Cronos and Tectonic have not announced any transaction reversal or address-freezing plan.

Crypto.com's application and centralized exchange remained operational during the Cronos network halt, with CEO Kris Marszalek stating that his company's security team was assisting with the investigation into Tectonic. Marszalek also committed to publishing a full post-mortem after investigators complete their review.