Oracle Network Halted on Four Chains Over Potential Move Compromise
The Oracle Network's Switchboard has halted its Move-based deployments on four blockchain chains - Aptos, Sui, IOTA, and Movement - due to a potential compromise. The incident was triggered by an allegedly compromised oracle key that pushed an asset price feed to $10 million on IOTA.
An investigation is underway, with Switchboard coordinating with affected teams and security organizations. According to the reported details, the attacker minted approximately 4.94 million VUSD using collateral whose value had been inflated by the corrupted feed. The event also reportedly triggered liquidations affecting 45 users.
The compromised oracle key was used for Virtue, an IOTA-based collateralized debt position protocol. When an oracle reports an extreme price, smart contracts can treat relatively small collateral deposits as assets worth far more than their market value.
No similar issue has been identified on Solana, but users were advised to temporarily migrate to alternative oracle solutions while the investigation continues.