$110M Hack Rocks GAIN Token – Is the 17% Rebound a Bull Trap?

GAIN token investors face a brutal reality check after a devastating security breach.

The Aftermath

Digital asset markets reel as GAIN token suffers a catastrophic $110 million exploit. The protocol's security infrastructure crumbled under sophisticated attack vectors, leaving investors scrambling.

Dead Cat Bounce or Genuine Recovery?

That 17% rebound looks suspiciously like textbook market manipulation—the kind that makes traditional finance brokers blush with recognition. Price action suggests coordinated buying pressure, but fundamental weaknesses remain unaddressed.

Security Fallout

Smart contract vulnerabilities exposed the protocol's Achilles' heel. The hack bypassed multiple security layers, raising questions about audit processes and risk management frameworks.

Market Psychology at Play

Traders face the classic crypto dilemma: buy the dip or avoid catching falling knives. The rebound tempts bargain hunters, but seasoned investors recognize the pattern—artificial pumps often precede deeper corrections.

Regulatory Storm Clouds

Watch for increased scrutiny from financial authorities. When nine-figure sums vanish, regulators suddenly remember they have jobs to do—usually at the worst possible time for legitimate projects.

Key takeaways

What does GAIN’s rising MFI and oversold RSI suggest about its price action? 

It indicates potential for a rebound if buying pressure continues and momentum strengthens.

How are derivative traders reacting to GAIN’s post-hack volatility? 

Despite bearish volume, rising funding rates and long positions hint at a possible recovery trend.

Griffin AI [GAIN] market performance has sent shockwaves through investors, as the asset plunged 78% following a major BNB Chain hack.

Investors are not giving up yet. Market sentiment shows they are scooping up the asset—a MOVE suggesting investors see the drop as a discount.

At press time, GAIN was up 17% in the past day, yet investors remain cautious: is this a sustained long-term move or a potential bull trap?

AMBCrypto analyzes the market to provide clear insights on what to expect from the asset in the coming days.

GAIN hack and recovery momentum

The recent hack on GAIN targeted its BNB Chain, the team revealed.

Hackers exploited the protocol to mint 5 billion GAIN tokens, worth around $110 million, and dumped them on unsuspecting users, triggering a major liquidity shock. 

The price chart captured this event with a sharp single-candle drop, followed by highly volatile and erratic price action.

Source: TradingView

Notably, amid this volatility, the asset has formed a likely support level, known in technical analysis as a double bottom pattern.

This double bottom level, however, could act as a trap. It may trigger a stop hunt that liquidates buyers trading into the zone before the asset makes a sharp upward move.

Will GAIN fall again?

According to AMBCrypto analysis, a further decline appears likely based on current technical indicators. 

Both the Money FLOW Index (MFI) and Relative Strength Index (RSI) show bearish signals, though with an important nuance. 

The MFI ranges from 20 to 80, readings between 20 and 50 suggest liquidity outflows and bearish sentiment, while values above 50 indicate bullish inflows.

Source: TradingView

At the time of writing, GAIN’s MFI stood at 46 and was trending upward – indicating increased buying activity and higher bids. 

If the MFI crosses above 50, it could signal the beginning of a rally.

Meanwhile, the RSI, which operates on a 30–70 scale, showed GAIN in the oversold zone below 30. 

This suggests selling pressure may be fading, and a potential rebound could be on the horizon.

Derivative investors are in

Derivative investors remain active, despite overall bearish derivative volume, as indicated by the long-to-short ratio across exchanges.

The Long/Short Ratio showed that while investors are mostly selling, Binance and OKX buyers are scooping the asset.

Source: CoinGlass

However, the Open Interest (OI) Weighted Funding Rate suggests that selling dominates the derivative market. Most liquidity comes from investors holding long positions.

With the OI-Weighted Funding Rate trending upward, GAIN is likely to gain momentum in the coming sessions, potentially trending higher and recovering from the selling pressure induced by the hack.