Syscoin (SYS) paused its bridge after an attacker exploited a validation issue, creating roughly 5 billion unauthorized SYS on the network’s UTXO chain.
The project is tracing the unauthorized tokens and working with exchanges to keep the tainted balances out of open markets.
How the Attacker Minted 5 Billion SYS
The incident centered on the bridge relay path, which checks transactions moving between two chains. The team said that the path wrongly accepted a transaction proof.
The system then treated the fraudulent transaction as valid. It minted an unauthorized output of about 5 billion SYS through the UTXO bridge path.
“An attacker exploited a validation issue in the bridge flow that resulted in an unauthorized SYS output being created on the UTXO side,” the post read.
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Those funds first reached a single address. Attackers later spent and split them into two tainted balances of roughly 4 billion and 1 billion SYS across separate wallets.
Syscoin described the findings as preliminary. It also urged users not to interact with the bridge while it remains paused.
“The team has identified the affected validation path and has a fix in place. Our priority now is to complete implementation and review of the fix, while also determining the correct process to rectify the unauthorized SYS output and neutralize its impact on the network. We will provide further updates once the remediation path has been finalized,” Syscoin said.
The news negatively impacted the token’s price. According to BeInCrypto Markets data, SYS fell more than 7% over 24 hours, trading near $0.0016. The slump comes amid a broader market recovery, which has lifted total market capitalization by over 2%.
The breach adds to a tense stretch for blockchain security. PeckShield logged 40 major incidents in May 2026, with 8 bridge and cross-chain exploits.
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