GMX token faced a significant price drop following a recent hack on the platform. This article examines the details of the incident, its causes, and market impact.
Hack Attack on GMX
On July 9, the GMX token hit a low of $10.20, its lowest level since April 7. The hackers drained approximately $40 million from the GLP pool on the GMX V1 on Avalanche and Arbitrum. The GMX team confirmed the incident in a post on social media platform X.
Causes and Consequences
In follow-up statements, developers attributed the root cause of the exploit to how the short average price was calculated in GMX V1. In response, the protocol paused trading on V1 and halted the minting of new tokens on GMX V2. Security has always been a core priority for GMX, with the GMX smart contracts undergoing multiple audits from leading firms.
GMX Price Analysis
The price chart shows that GMX peaked at $18.11 in June before reversing sharply. The token broke below key support at $12.63. The current trend points downwards, with the next target for sellers being the year-to-date low of $9.70. A break below this level may open the door to further downside, potentially toward $8.
The hack on GMX highlights vulnerabilities in decentralized finance systems and may significantly impact the market, affecting user and investor confidence.
