Griffin AI (GAIN), a Web3 AI project that launched on Binance Alpha yesterday, is facing its first major crisis.
Within 24 hours of its debut, $GAIN briefly plunged more than 90% after a wave of abnormal minting and heavy on-chain dumping shook investor confidence.
On-chain data shows the exploit originated from a suspicious cross-chain setup that allowed billions of fake tokens to be created.
Exploit Details: 5 Billion Tokens Minted
At 7:04 AM (UTC+8), blockchain records revealed that address 0xF3…8Db2 minted 5 billion GAIN from the null address (0x00…0000). This minting event inflated the total supply from its intended 1 billion to over 5.2985 billion.
Shortly after, the same wallet dumped 147.5 million GAIN on PancakeSwap, pocketing at least 2,955 BNB in profits. The funds were then bridged through deBridge, raising immediate red flags across the crypto community.
Griffin AI Confirms the Incident
The official account @Griffin_AI acknowledged the abnormal activity, warning users not to interact with the token.
“Cause: $GAIN was abnormally minted an additional 5 billion tokens and continuously dumped. The original max supply was 1 billion.”
The team confirmed they have formally requested all exchanges to pause trading, deposits, and withdrawals of GAIN on BSC, while also shutting down the PancakeSwap liquidity pool.
How the Attack Happened
Investigators traced the fake supply back to a compromised cross-chain setup involving LayerZero. The attacker:
- Created a malicious Ethereum contract, $TTTTT (0x7a8caf), minted just 12 hours before the exploit.
- Added this fake contract as the Ethereum peer for GAIN’s cross-chain endpoint.
- Used the unauthorized peer to mint 5B fake GAIN on the Binance Smart Chain.
- Began dumping tokens on-chain, causing the price collapse.
The wallet address behind the exploit is 0xf3d17326130f90c1900bc0b69323c4c7e2d58db2, which still holds the excess minted tokens.
Full on-chain transaction record: [BscScan](https://bscscan.com/tx/0xa85b18bdb…)
Griffin AI’s Emergency Response
The Griffin AI team moved quickly to contain the damage. In a follow-up statement, they outlined their immediate steps:
- Disabled cross-chain connections to block further unauthorized minting.
- Requested exchanges halt all $GAIN activity on BSC.
- Shut down liquidity pools to prevent additional dumping.
- Informed law enforcement and engaged security partners.
The project stressed that its Ethereum token remains safe and unaffected. However, around 2.8% of the fake supply, worth an estimated $3 million, was already sold on-chain.
Security Partners Step In
Blockchain security firm GoPlus Security flagged the incident in real time, calling attention to the fake LayerZero peer and the subsequent dump.
Initial investigations suggest that one of the project’s private keys may have been compromised, though there is no current evidence of insider involvement.
Impact on $GAIN Price
According to CoinMarketCap, $GAIN traded as high as $0.19 at launch on Binance Alpha. Following the exploit, the token crashed over 90%, briefly touching $0.005 before stabilizing slightly as trading paused.
Market sentiment has soured, with many investors labeling the project’s cross-chain security setup as its biggest vulnerability.
What’s Next for Griffin AI?
The Griffin AI team now faces the difficult task of regaining user trust. With trading frozen across exchanges and liquidity disabled, holders have limited options.
The team’s next steps will likely involve:
- Rebuilding cross-chain security architecture.
- Collaborating with exchanges on token recovery or rollback plans.
- Working with law enforcement to trace and freeze attacker funds.
Community members are pressing for transparency, demanding a clear post-mortem on how the LayerZero peer was compromised and whether the project can prevent future exploits.
The Griffin AI exploit highlights the risks of complex cross-chain systems. While the project insists that its Ethereum token remains secure, the ability of attackers to mint billions in fake supply has already devastated confidence.
For now, $GAIN holders must wait for further updates from the team and exchanges. Until then, Griffin AI remains a cautionary tale in the high-risk world of Web3 token launches.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.
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