- Odin hackers drained $7 million in BTC through AMM vulnerability within two hours
- Platform treasury insufficient to cover losses, raising user compensation concerns
- Multiple law enforcement agencies cooperating with exchanges to track perpetrators
Odin.fun has identified Chinese-based groups as the primary perpetrators behind a major exploit that drained 58.2 BTC worth approximately $7 million from the Bitcoin meme coin launchpad.
Co-founder Bob Bodily revealed that attackers exploited a vulnerability in the platform’s newly deployed automated market-making tool to systematically extract funds from liquidity pools.
The attack occurred on August 12-13, 2025, when hackers injected worthless tokens into BTC liquidity pools to artificially inflate exchange rates before removing liquidity at manipulated prices.
Platform reserves plummeted from 291 BTC to 232.8 BTC within two hours, indicating coordinated manipulation across multiple addresses.
AMM Vulnerability Enabled Systematic Fund Drainage
The exploit targeted Odin.fun’s latest AMM update, where attackers inserted tokens like SATOSHI into BTC pools to create false price ratios.
This manipulation allowed hackers to withdraw real Bitcoin at artificially inflated exchange rates, effectively converting worthless tokens into valuable cryptocurrency.
Bodily acknowledged that the company treasury lacks sufficient funds to cover the $7 million loss, creating uncertainty about full user compensation.
The platform immediately suspended all trading and withdrawal operations to prevent further losses and protect remaining user funds from additional exploitation.
The native $ODINDOG token crashed 40% following news of the hack and trading suspension.
User confidence eroded as details emerged about the treasury shortfall and extended recovery timeline.
International Law Enforcement Mobilizes Against Perpetrators
Odin.fun has engaged blockchain security firm PeckShield to trace attacker wallet movements while cooperating with U.S. law enforcement agencies.
The platform also contacted OKX and Binance, which have engaged Chinese authorities to pursue the identified perpetrator groups.
Bodily expressed surprise at the rapid response from exchanges and law enforcement, suggesting strong cooperation in tracking cross-border cryptocurrency crimes.
He warned perpetrators they have a “short window” to return stolen funds before facing prosecution, claiming many attacker addresses have been identified.
The platform has gathered extensive evidence including wallet activities and transaction patterns to support legal proceedings.
Bodily indicated that identified groups will face prosecution in both China and the United States, leveraging international cooperation agreements.
Recovery Plan Faces Treasury and Timeline Challenges
Odin.fun has contracted a top-tier security auditing team to conduct comprehensive code reviews, which could take up to one week before operations resume.
The platform promises to implement enhanced security measures and fix the AMM vulnerability before re-enabling withdrawals.
Despite the setback, Bodily maintained that Odin.fun remains the leading Bitcoin DeFi platform and will continue building. He promised to develop a concrete compensation plan for affected users, though specific details await finalization pending the security audit completion.
The incident adds to a growing list of DeFi exploits in 2025, including a $1.5 billion Ethereum heist at Bybit and $11 million stolen from BitoPro.
Platform Reputation and User Trust at Stake
The hack occurred during Odin.fun’s rapid growth phase as a Bitcoin memecoin launchpad, potentially damaging its market position.
User confidence depends heavily on the platform’s ability to implement promised compensation and security improvements.
Bodily emphasized that the incident wouldn’t derail the platform’s long-term vision for Bitcoin DeFi development.
He committed to earning back user confidence through actions rather than words, promising transparency throughout the recovery process.
The exploit shows vulnerabilities in rapidly deployed DeFi protocols, particularly AMM systems handling significant liquidity.
