Yuga Labs-linked white hats rescued 68 NFTs price over $500,000 from an exploit on Flooring Protocol on June 8, 2026, after a flaw within the protocol’s accounting mechanism allowed an attacker to inflate fpToken balances, drain liquidity swimming pools, and change tokens for NFTs locked within the contract.
The flaw was not restricted to a single remoted pool. It resided throughout the contract mannequin that converts locked NFTs into fungible tokens, leaving each FloorProtocol V2 and BitmapPunks affected.
What Occurred
The exploit focused the mechanism that enables NFTs locked inside Flooring Protocol to be represented by fungible tokens. In keeping with 0xQuit, VP of Blockchain at Yuga Labs, the attacker used a really small quantity of WETH to generate a near-infinite fpToken stability, thereby draining liquidity from Flooring swimming pools.
After a number of swimming pools had been drained, one other tackle continued to benefit from the token value being pushed down to close zero to purchase low cost tokens, redeem them for the underlying NFTs, and promote them. The evaluation group later found an extra associated exploitation path that would have an effect on different swimming pools, together with these containing higher-value NFTs.
FreeLunchCapital, the architect behind the FloorProtocol V2 and BitmapPunks contracts, said that BitmapPunks was additionally affected as a result of it used the same contract construction. Each used a mannequin the place fungible tokens are pegged 1:1 with NFTs locked within the contract, permitting customers to transform forwards and backwards between tokens and NFTs.
A Flooring exploit right this moment turned a mud quantity of WETH right into a near-infinite fpToken stability, permitting the attacker to empty Flooring swimming pools.
This led to a followup opportunist scooping up tokens from the now depleted swimming pools and exchanging them for underlying NFTs.
1/🧵
— Stop (@0xQuit) June 8, 2026
In keeping with 0xQuit, the high-value swimming pools had not been attacked primarily attributable to a scarcity of liquidity on Uniswap. As soon as the white hat group recognized that the exploitation technique could possibly be utilized to different weak swimming pools, they determined to execute the rescue instantly to mitigate the danger of one other attacker front-running them.
White Hat Response
Michael Figge, CEO of Yuga Labs, said that the group accomplished a white-hat operation on Flooring Protocol. The property secured into custody embrace 29 Bored Apes, 4 Mutant Apes, 1 Bored Ape Kennel Membership, 2 CryptoPunks, 1 Azuki, 2 Elementals, 26 Captains, 1 Moonbird, and a pair of Doodles, bringing the full variety of rescued NFTs to 68.
On this marketing campaign, 0xQuit instantly recovered these NFTs. Coffeedev found the danger that would unfold to different Flooring collections resembling BAYC and CryptoPunks, whereas GrailsOTC supplied the upfront funds and NFTs required for the rescue.
0xQuit said that the rescue contract utilized the identical set of flaws defensively to maneuver the at-risk NFTs out of Flooring swimming pools earlier than different attackers may exploit them. The rescued NFTs are valued at over $500,000 and are at present being held to work with related events to return them to their rightful house owners.
How The Exploit Labored
In keeping with 0xQuit, the exploit stemmed from how Flooring Protocol information NFT possession after the NFTs are locked and represented by fpTokens. The exploit mechanism occurred within the following sequence:
Creating an entry level: The attacker used a purposefully generated token ID to make the contract affirm possession as if it had been legitimate.Skewing the accounting: This token ID brought on the possession examine and inner bookkeeping to document mismatched information, making a state of “ghost possession.”Inflating the stability: Because the attacker continued to switch or unwrap/burn tokens, subtractions that weren’t correctly checked underflowed, wrapping the fpToken stability right into a near-infinite quantity.Draining worth from swimming pools: With the inflated stability, the attacker may drive the pool value down to close zero, drain liquidity, and change tokens for the underlying NFTs.
FreeLunchCapital additionally said that the flaw was situated throughout the bit-level code optimized to scale back fuel charges, which had slipped by means of a number of rounds of safety opinions.
What Stays Unresolved
The incident continues to be not thought-about totally resolved. A number of NFTs stay within the palms of the exploiters, whereas the 68 rescued NFTs are at present in custody in preparation for return to their rightful house owners. 0xQuit additionally warned customers to not deposit extra NFTs into Flooring Protocol, as newly deposited property may change into weak instantly.
Yuga Labs said it’s going to coordinate with protocol builders, with the potential want for contract relaunches, token reassurances, or different measures to make sure the return course of doesn’t create further dangers. On the operational aspect, FreeLunchCapital mentioned they’re working to regain management from the dad or mum group of the administration group, whereas coordinating with safety groups and exchanges to hint extracted funds and property.
Broader Context
The Flooring Protocol incident additionally highlights the dangers of techniques that convert NFTs into fungible liquidity. When NFTs are locked in a contract and represented by tokens, customers are usually not solely uncovered to market dangers but in addition depend upon the protocol’s accounting logic, possession, redemption processes, and liquidity design.
This danger is especially notable as a result of the rescue record contains main collections like BAYC and CryptoPunks. If these property had been to be redeemed and bought by attackers, the impression may lengthen past Flooring Protocol, particularly for fractionalization tasks using related contract buildings.
