K Token Crashes 87% Amid Arbitrum Contract Exploit

- 7M minted tokens trigger liquidity crisis. - Attacker drains USDC after contract flaw exposes vulnerabilities. On July 10, 2025, Cryptopolitan reported that Kinto's native token, $K, suffered an 87% price collapse. The crash followed an exploit that targeted its mint contract on the Arbitrum network, where an attacker exploited vulnerabilities in the contract's design and gaps in the audit process, allowing them to mint 7 million unauthorized tokens. Instead of flooding the market with the new tokens, the attacker used them as collateral on the Morpho lending protocol. This strategy enabled them to borrow vast sums of USDC, a maneuver that subsequently disrupted liquidity across multiple platforms and sparked a cascading, market-wide crash. Kinto clarified that the exploit was limited to the $K token deployment on Arbitrum and did not compromise user funds within its core exchange system. In a statement on July 10, the company affirmed, "User funds remain secure." In response, Kinto launched an investigation, enlisting cybersecurity firms Hypernative, Seal 911, and Zeroshadow to analyze the incident. The company has also committed to providing a detailed report once the investigation concludes. This incident raises fresh concerns about the security of DeFi platforms. As of July 10 at 15:09 UTC, USDC was trading steadily at $1, with a slight 0.02% change in 24-hour volume. Meanwhile, Sui (SUI) recorded a 9.165% gain to trade at $3.22, which highlights the market’s ongoing volatility.