GMX Hacked for $42M in GLP Pool Exploit

This popular decentralized trading protocol was exploited for over $42 million. This was after a hacker manipulated the GLP pool.

The attacker minted GLP tokens — which represent liquidity in GMX. Then, quickly redeemed them for real crypto assets, including ETH and stablecoins. Let’s discover more about this important event for GMX.

How the GMX Exploit Happened

GMX has confirmed that its Version 1 platform on Arbitrum suffered a major exploit, resulting in the loss of around $40 million in tokens from the GLP pool. The funds were transferred to an unknown wallet, sparking immediate concern across the DeFi community. GMX responded quickly by disabling trading and halting the minting and redeeming of GLP on both Arbitrum and Avalanche. This action was taken to prevent further damage and protect users while the investigation continues.

This marks one of the largest DeFi exploits of 2025 so far, and it has sent shockwaves through a community that sees GMX as a pillar of decentralized finance. The protocol’s developers have issued a 10% bounty offer if the attacker returns 90% of the funds within 48 hours. So far, the hacker has already bridged about $9.65 million to Ethereum and converted the stolen funds into DAI and ETH.

The exploit targeted GMX’s GLP pool, which acts as a basket of assets users can contribute to and earn rewards from. By finding a vulnerability in how GLP tokens are minted and redeemed, the attacker created a loophole to extract more value than was deposited. Simply put, the hacker tricked the system into giving out real assets in exchange for newly created tokens that cost them little to produce.

More About the GMX Exploit

The GMX team emphasized that security has always been a top priority. Its smart contracts have undergone multiple audits by respected security firms in the blockchain space. In this urgent situation, all core contributors are actively working to understand how the exploit happened and what weakness in the system allowed it. They’ve described this as an “all hands on deck” moment, showing how seriously the team is taking the incident.

Also, GMX’s external security partners have joined efforts to uncover the full scope of the breach. GMX reassured users that its top priority is not only recovering the stolen funds. But, also fully understanding the root cause of the issue so that future attacks can be prevented.

Importantly, GMX clarified that the exploit affects only GMX V1 and does not impact GMX V2, its newer version, or the GMX token itself. The markets and liquidity pools under V2 remain unaffected. For now, the team urges users to stay cautious and wait for further updates.

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