Taiko warns users after hack on verification mechanism

The Ethereum Layer 2 network Taiko is facing a serious security incident. The blockchain’s verification mechanism has been compromised, meaning the security of all bridges on the network is no longer guaranteed. Users are strongly advised to withdraw their funds immediately.

What exactly went wrong

Taiko published an official security notice on X stating that the so-called chain state verification mechanism has been hacked. This is the system that checks the validity of transactions and state transitions on the network. Because this mechanism has been compromised, the security assumptions of all bridges deployed on Taiko can no longer be considered reliable.

Blockaid reports that Taiko’s ERC20 Vault on Ethereum is the target of an attack, with damages already exceeding $1 million. An initial analysis points to a vulnerability in the so-called source-signal proof verification mechanism of the Taiko bridge. This is not the first major security incident to hit the Ethereum ecosystem recently.

Urgent measures for users and exchanges

Taiko is actively working with the Security Council and partners within the ecosystem to mitigate the damage. Affected systems are being temporarily shut down where possible, and both technical and legal steps have been initiated. The team says it is taking all necessary actions to bring the incident under control.

In addition to the advice for users, Taiko is also requesting centralised crypto exchanges to pause TAIKO deposits until a new official announcement is made. Users who have funds on Taiko bridges are strongly urged to withdraw them as soon as possible and not to make any further deposits until the situation is resolved.