Hacker’s Generous Return of $40M to GMX Sparks 10% Rally, But Is It Too Good to Be True? 🤔💰

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 Key Insights:

  • A hacker recently drained the GMX decentralized exchange of $40 million in assorted cryptocurrencies, but not without a twist of fate and a dash of humor.
  • The hacker, after some negotiations and a generous offer from GMX, began returning the funds, causing a 10% price increase in the price of $GMX. Who knew crime could pay, or rather, returning the loot could?
  • Despite the recovery, GMX is still at risk of bearish influence as its price threatens to break below $10. But hey, at least they got a 10% rally out of it, right?

 

This week saw an interesting turn of events when the hacker who drained $40 million from the GMX decentralized exchange returned the stolen funds. Said event happened after the GMX team offered the hacker a $5 million white hat bounty, and here’s how this incident led to a massive GMX price spike. It’s like a modern-day Robin Hood, but with a twist of blockchain and a sprinkle of sarcasm. 🤪

How GMX Was Attacked

The hack happened on Wednesday and targeted a liquidity pool on GMX v1, the first version of the trading platform on Arbitrum. The attacker took advantage of a design flaw to manipulate the value of GLP tokens. This allowed them to siphon off several classes of crypto assets. At the time of the theft, the attacker made off with an estimated $40–42 million worth of assets. Most of these included Ether (ETH) and FRAX, with all hope of recovering the funds appearing to have been lost. But wait, there’s more!

However, the story took an unexpected twist when blockchain security firm PeckShield flagged an on-chain message from the attacker. Within the message, the hacker wrote, “Ok, funds will be returned later.” Shortly after that message, the address labeled GMX Exploiter 2 began transferring funds back to GMX. Within hours, over $9 million in ETH had been sent to the recovery wallet specified by the GMX team. It’s like the hacker had a change of heart, or perhaps just a change of wallet. 🤑

Exploiter has returned 5.49M to : Deployer

— PeckShieldAlert (@PeckShieldAlert)

This was followed by two separate transfers of $5.5 million and $5 million in FRAX, respectively. As of the latest update, approximately $40.5 million worth of the stolen assets had been returned. These include 10,000 ETH (valued at around $30 million) and $10.5 million in FRAX. It’s like a digital heist turned into a digital charity event. 🎉

A Deal with Conditions

The GMX team had previously acknowledged the attacker’s technical skill and extended an olive branch via a public message on X. They offered a $5 million white hat bounty in exchange for the return of at least 90% of the stolen funds. The remaining 10% could be kept as a reward. It’s like the ultimate get-out-of-jail-free card, but in crypto form. 🎴

Looks like the exploiter might be preparing to return the funds.

— SlowMist (@SlowMist_Team)

“You’ve successfully executed the exploit; your abilities in doing so are evident to anyone looking into the exploit transactions,” the GMX team wrote. “The white hat bug bounty of $5 million continues to be available.” GMX also made it clear that the bounty would allow the hacker to spend the funds freely without fear of repercussions. It’s like a digital version of “Catch Me If You Can,” but with a much higher reward. 🕵️‍♂️💰

GMX Recovers 10%

The token rallied by 10% on 11 July, when the hacker agreed to return the stolen funds. However, before this, the GMX token had been in a downtrend since hitting a high of $46.8 in early December of last year. Between then and now, the cryptocurrency has been down by around 72%, crashing to a new low of $10.12 as of 9 July. This $10.12 price level appears to be a strong support zone. Previously, it held GMX up in an earlier crash on 6 April.

This said, the only thing keeping GMX up from a bearish spiral downwards is the range between $10 and $10.12. So far, the 10% price increase on 11 July has provided the bulls some degree of relief from this spiral. However, the threat still remains. GMX is currently hovering underneath its 200-day EMA. This means that the bears are in control of things at the moment. It’s like a tug-of-war, but the bears have a stronger grip. 🐻💪

This is further reinforced by the position of the RSI underneath the neutral line. In conclusion, the Fibonacci retracement levels show that GMX needs to reclaim the $15.2 price level soon, or continue downwards under the influence of its bears. But who knows? Maybe the hacker will come to the rescue again. 🤞

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2025-07-12 23:00