Switchboard Halts Operations Amid Potential Security Compromise on Aptos, Sui, IOTA, and Movement
Switchboard, a multi-chain oracle protocol that feeds price data to DeFi applications across several blockchains, has halted operations on its Move-based deployments after discovering a potential security compromise. The affected networks include Aptos, Sui, IOTA, and Movement.
The halt, which occurred during the transition from August 28 to 29, represents one of the more serious oracle-level incidents in recent memory. An attacker exploited a compromised oracle key on IOTA to manipulate the token's price feed, temporarily setting it to $10 million. This allowed them to mint approximately 4.94 million VUSD through the Virtue CDP protocol.
Forty-five users were directly affected by liquidations as a result of this manipulation. Exchange addresses were frozen in response to the chaos, and the Virtue CDP protocol itself was halted.
Switchboard's decision to halt all Move-based implementations suggests that the vulnerability may be architectural rather than network-specific. The protocol is actively collaborating with relevant security agencies to investigate the breach.