Odin.fun hit by $7M liquidity attack in latest memecoin heist

Odin.fun $7M lose has sent shockwaves through the Bitcoin DeFi community after the platform confirmed that attackers drained 58.2 BTC worth approximately $7 million in a sophisticated liquidity manipulation exploit on August 12.

The Bitcoin-based memecoin launchpad and trading hub saw deposits plunge from 291 BTC to 232.8 BTC in less than two hours, according to blockchain security firm PeckShield. The firm first disclosed the incident on X (formerly Twitter), citing a community tip-off.

In this latest Odin.fun $7M lose incident, attackers added obscure tokens such as SATOSHI into Odin’s liquidity pools, artificially inflated their value, and then withdrew liquidity to siphon BTC without returning the paired assets.

“This was a targeted attack exploiting a flaw introduced in a recent automated market maker update,” — Bob Bodily, Co-founder, Odin.fun, in a statement to users. “Our treasury cannot fully cover the loss, but we will present a concrete compensation plan for affected accounts.”

Operations halted, investigation underway

Following the Odin.fun $7M lose, the platform immediately paused trading and withdrawals in an effort to contain damage. Bodily said Odin.fun has retained a leading blockchain security firm for a week-long audit and contacted law enforcement in the United States.

The company is also working with exchanges OKX and Binance, which are coordinating with Chinese authorities after evidence suggested several attackers were operating from China.

“You have a short window to return the funds before it is too late. This is not a negotiation,” Bodily warned in a public statement addressed to the hackers. “You have one chance to limit the consequences and avoid prosecution.”

Odin.fun claims to have gathered extensive blockchain evidence, including wallet addresses and transaction histories linked to the exploit.

Community backlash and a history of hacks

The Odin.fun $7M lose episode triggered an immediate 40% drop in ODINDOG, the platform’s native token, sparking concerns about whether the launchpad can rebuild credibility after multiple breaches.

While some users commended the transparency of Odin.fun’s communication, others were quick to note the pattern of security lapses. In April 2025, the platform lost $178,000 in a separate breach tied to flaws in its “Sign-In With Bitcoin” authentication system. That vulnerability was patched, but critics argue that the underlying security culture has not improved.

This latest Odin.fun $7M lose marks the fourth publicized exploit since 20220 which is a record that industry observers say could limit the platform’s growth despite its strong user base in the Bitcoin DeFi niche.

“Repeated incidents like this don’t just cost money; they erode trust,” — Elena Wong, Blockchain Security Analyst, DeFiGuard. “For DeFi platforms, credibility is as important as liquidity.”

Wider trend of DeFi exploits

The Odin.fun $7M lose comes during a broader surge in DeFi-related hacks. Data compiled by crypto.news shows that July 2025 alone saw 17 significant exploits, causing losses of $142 million which is a 27% rise from the previous month.

Most stolen funds are now funneled through cross-chain bridges, which have overtaken traditional mixers as the primary laundering method for illicit crypto assets. Analysts say platforms like Odin.fun are attractive targets because their liquidity mechanisms can be manipulated without breaching core wallet infrastructure.

“This isn’t just an Odin.fun problem — it’s a DeFi-wide problem,” — Mark Reynolds, Director, Crypto Crime Research Unit. “Attackers are becoming more sophisticated, and protocols need to be more proactive about testing for these manipulation vectors before deploying updates.”

Next steps for Odin.fun

Despite the scale of the Odin.fun $7M lose, Bodily insists the platform is “here to stay” and will take steps to restore confidence once the audit is complete. No timeline has been given for the resumption of normal operations, but the co-founder pledged that security enhancements and user compensation will be top priorities.

The incident leaves Odin.fun at a crossroads facing both technical and reputational challenges in a sector where investor trust can evaporate as quickly as liquidity in a compromised pool

For now, the Odin.fun $7M lose stands as another high-profile reminder that in DeFi, rapid innovation often comes with equally rapid exposure to risk.