Echo Protocol Halts Withdrawals After $266M Security Breach

• Lyla Velez
• June 15, 2025
• Uncategorized
• 0 Comments

Echo Protocol announced the suspension of withdrawals following a $266 million security breach on June 14, 2025. The breach involved a supply chain attack compromising over 2,515 uBTC assets.

This incident underscores the pressing security concerns within decentralized finance (DeFi), prompting increased scrutiny of existing safety measures.

The Echo Protocol reported that its holding of 2,515.65 uBTC, valued at over $266 million, was compromised by a sophisticated supply chain attack. The team has suspended withdrawals and enlisted security experts and third-party auditors for asset recovery, planning a bounty program to bolster these efforts.

“Today, our wallet holding 2,515.648579 uBTC (valued at over $266 million) was subjected to a highly sophisticated supply chain attack and has been maliciously compromised. We have suspended withdrawals, engaged with security experts, and will publish an event review as soon as possible. A bounty program is forthcoming to aid asset recovery” — Echo Protocol Team, Official Statement, Echo Protocol.

Security experts and third-party auditors are engaged in emergency investigations, while the Echo Protocol team has pledged transparency through an upcoming event review. Their priority remains containing the financial loss and addressing collateralization impacts, which have significantly dropped.

The incident has significantly impacted the DeFi sector, casting doubt on security infrastructure. With a 20% drop in collateralization, the attack threatens Echo Protocol’s solvency. Institutional investors and users face potential losses.

Regulatory scrutiny may increase, with potential calls for enhanced audit standards across DeFi platforms. The attack highlights vulnerabilities, pushing for stronger technological defenses and audit procedures to ensure user asset protection moving forward.