Echo Protocol pauses bridge after $77 million eBTC attack

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Echo Protocol pauses bridge

Highlights

The attacker minted about 1,000 eBTC worth roughly $76.7 million.
Part of the eBTC was used as collateral on Curvance to borrow 11.3 WBTC, worth about $868,000.
The funds were bridged to Ethereum, swapped for ETH, and then 384 ETH, worth about $822,000, was sent through Tornado Cash.
Echo Protocol paused all cross-chain transactions during the investigation.

Attack on Echo bridge in Monad

Echo Protocol said it is investigating a security incident affecting the Echo bridge on Monad and has paused all cross-chain transactions until the review is complete. According to PeckShield, the attacker minted about 1,000 eBTC, synthetic Bitcoin tokens worth roughly $76.7 million.

The attacker then tried to monetize part of the minted assets. He deposited 45 eBTC worth about $3.45 million into the DeFi protocol Curvance, used it as collateral, and borrowed 11.3 WBTC worth about $868,000. The WBTC was then bridged to Ethereum, swapped for ETH, and 384 ETH worth about $822,000 was sent through the mixer Tornado Cash.

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Cause of the incident and market reaction

One important detail is that some experts do not describe the incident as a standard smart contract bug. A developer known as Marioo said the cause was a compromised administrative private key, not a technical flaw in the contract itself. According to him, the eBTC contract worked as intended, but the system had weak operational settings: a single-signature admin role, no timelock, no mint cap, and no sanity check on collateral value in Curvance.

It was aware of an anomaly in the Echo eBTC market and had found no compromise of its own smart contracts. Monad also sought to separate the incident from the base network: Monad co-founder Keone Hon said the Monad network was not affected and was operating normally.

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The ECHO token came under pressure after the incident. CoinMarketCap data showed a decline of about 11.69% over 24 hours, with market capitalization near $1.58 million.

A new stress test for BTCFi

The attack on Echo is part of a broader wave of DeFi exploits. At least 12 protocols have been compromised this month, including THORChain, Verus Protocol’s Ethereum bridge, Transit Finance, TrustedVolumes and Ekubo. Major 2026 incidents also include the $285 million Drift Protocol exploit and the $292 million Kelp DAO attack in April.

For the BTCFi market, this case is especially sensitive. Echo Protocol builds products around Bitcoin liquidity, staking, restaking, and yield through synthetic BTC assets such as eBTC. If control over the issuance of such an asset is weak, the risk can quickly spread from one protocol to other markets where that asset is accepted as collateral. That is exactly what happened through Curvance.

We also reported Bitcoin holds below $77,000 after a liquidation wave.

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