Cosmos Labs Urges EVM Chain Halts After KiiChain 148M KII Exploit

Cosmos Labs has urged networks using its EVM module to ask validators to halt their chains as engineers respond to vulnerabilities affecting the software that brings Ethereum-compatible execution to Cosmos SDK networks.

The emergency halt request came after several Cosmos EVM networks took defensive action and KiiChain suffered the largest confirmed loss. Cosmos Labs is coordinating with affected teams and plans to release a full incident report after the remaining security work is completed.

KiiChain Attack Moved 148 Million KII

KiiChain’s August 22 exploit moved 148.33 million KII through 18 attack rounds before validators stopped the network at block 9,355,723. The attack abused vulnerabilities in shared Cosmos EVM components rather than KiiChain-specific application code, expanding the security issue beyond a single network.

More than half of the tokens remain recoverable. About 80.73 million KII, or 54.4% of the stolen amount, never left KiiChain and remain frozen at attacker-controlled addresses. Another 67.6 million KII crossed through Hyperlane to BNB Smart Chain, where 64.6 million were sold for BUSD and USDT and 3 million reached KuCoin. A freeze request has been submitted for the exchange deposit.

The earlier KiiChain halt initially left the loss amount unresolved while the team traced the BSC transfers. Hyperlane served as the route out of KiiChain after the EVM exploit and has not been identified as the vulnerable component.

KII has recovered sharply from the selloff that accompanied the attack. The token was trading near $0.061 early Tuesday after reaching an all-time low of $0.01131 on August 22, a rebound of more than 400%.

Warden Ships Patch as MANTRA Also Halts

Warden Protocol released version 1.0.2 on August 23, upgrading Cosmos EVM to v0.6.2 and blocking the creation of vesting accounts through the affected path. The release followed Cosmos EVM v0.6.2 and v0.7.2, both published August 19 with security fixes requiring coordinated, state-breaking upgrades.

MANTRA had already halted its mainnet on August 21 after isolating an exploit to an upstream software dependency. Validators, public endpoints and MANTRA-operated cross-chain infrastructure were stopped while patched software was prepared.

Cosmos EVM embeds a full Ethereum Virtual Machine inside Cosmos SDK chains, allowing Solidity contracts to interact directly with native staking, governance and IBC modules through precompiles. KiiChain’s incident analysis identified three defects involved in the exploit path, while only the underflow component had been publicly patched upstream when its report was released.

KiiChain remains halted while its patched upgrade is prepared. The restart plan includes recovering the 80.73 million KII still held onchain and adding withdrawal limits to cross-chain routes before normal operations resume.

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