Initia Halts Layer-1 Blockchain Again After $615K Escrow Exploit
Initia stopped block production on its layer-1 network at 06:18 UTC on November 10 after attackers made unauthorized transfers from escrow accounts holding bridged rollup assets. The second halt in under three weeks comes as its native INIT token rose roughly 60% over 24 hours, per CoinGecko.
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What Happened
Initia halted block production on its layer-1 blockchain at 06:18 UTC on November 10, in coordination with validators, after identifying unauthorized transfers from escrow accounts that hold assets bridged to several rollups. The network's own estimate put the outflow at roughly $615,000, with about $605,000 in USDC and another $10,000 in other tokens leaving through the Noble chain before the halt.
Initia said most of the remaining assets moved out of the affected escrow accounts were still on the halted chain. The team has not said when block production will resume or whether affected users will be reimbursed.
Attack Method and Unresolved Questions
Initia said the attacker used compromised rollup infrastructure keys to fabricate Inter-Blockchain Communication (IBC) transfers, which allowed assets to move without authorization. The team has not explained how those keys were obtained or who controlled them before the incident.
The sources differ on the size of the outflow. Initia's preliminary figure is about $615,000. Blockchain security firm CertiK reported about $636,000 in suspicious outflows across 16 successful IBC transfers from an Initia address to Noble. Neither figure is final, since the investigation is ongoing and the amount of unrecoverable funds has not been established. Initia said it is working with security specialists, validators and exchanges to define the full scope.
A Second Incident in Three Weeks
The shutdown follows an October 23 suspension triggered by a vulnerability in Initia's MoveVM script-caching system. In an October 24 statement, the team said the flaw let malicious code bypass security checks and credit the attacker with unbacked WETH, iUSD and USDC balances. Approximately $2.7 million was bridged out before validators halted the network, and the attacker later converted the assets into 1,135.52 ETH on Ethereum. Initia said no native INIT tokens were minted in that attack. The network resumed operations on November 2 after an MoveVM patch.
On November 9, Initia disclosed a separate rollup infrastructure issue and paused certain rollups while the main chain kept running. At that stage it said it had identified no impact on user funds. The escrow investigation that followed led to the November 10 halt.
Market Reaction
INIT rose about 60% over 24 hours and more than 71% over seven days, according to CoinGecko data cited by CryptoPotato at the time of writing. The token was still about 84% below its May 2025 all-time high of $1.42. Price action during a chain halt is not a measure of the incident's resolution, and neither source attributes the gain to any specific cause.
Why It Matters
For Traders
The unresolved outflow figure and undetermined restart timeline mean INIT price moves may diverge sharply from chain status until the investigation publishes a final loss estimate.
For Investors
Two exploits in under three weeks raise questions about the security maturity of Initia's rollup architecture, independent of how quickly the chain resumes.
For Builders
Compromised rollup infrastructure keys enabled forged IBC transfers, so teams integrating with Initia should review their IBC channel trust assumptions and key management.
This article is for information only and is not financial advice. Read the full disclaimer.
