Saga EVM Exploited: $6.8M Vanishes in Major Smart Contract Breach
A gaping hole in Saga's EVM infrastructure just got exploited—to the tune of $6.8 million. The breach highlights the persistent, billion-dollar question in DeFi: can any code truly be trustless?
The Anatomy of a Heist
Attackers didn't pick a lock; they found a backdoor. The exploit targeted a vulnerability in Saga's smart contract execution layer, allowing funds to be siphoned directly from pooled assets. No fancy social engineering—just pure, unadulterated code arbitrage.
Fallout and Freeze
Transactions halted. Wallets frozen. The protocol's guardians scrambled to contain the bleed-out. For users, it's another stark lesson in counter-party risk—even when the counter-party is supposed to be a piece of immutable software.
The Irony of 'Secure' Assets
Another day, another eight-figure 'learning experience' for the crypto ecosystem. The finance jab? Traditional bankers are probably sipping Scotch and nodding—'See? We keep the vault keys for a reason.'
This isn't just a hack; it's a $6.8M audit bill paid in stolen funds, reminding everyone that in the race for decentralization, security is often the first casualty.
Saga pauses protocol for investigation
Saga suffered more than the direct loss, as the protocol’s TVL crashed from over $36M to $21M. Immediately after the exploit, Saga paused all activities to investigate the vulnerability.
SagaEVM has been paused at block height 6593800 in response to a confirmed exploit on the SagaEVM chainlet.
Mitigation is underway, and the team is fully focused on a solution.
Further updates will follow once details are confirmed.
— Saga ⛋ (@Sagaxyz__) January 21, 2026
Unauthorized token minting is one of the common exploits, which may be due to a smart contract bug. The contract was intended to bridge assets between Saga and Ethereum, allowing the hacker to withdraw more than the available balance of stablecoins.
The ETH from the exploit is still held in a single address and has not been moved or mixed. The exploiter still holds a remaining D stablecoin balance of over $12M, in addition to smaller amounts of tokens.
Saga lost over 42% of its total value locked, due to the direct hack and the de-pegging of Saga Dollar (D) stablecoins down to $0.75 from a usual range of $1. | Source: DeFi Llama
The stalled Saga protocol means the attacker cannot trade any more D stablecoins on the native chain. However, the protocol and the chain are now frozen and may take a while to recover their value locked in apps and the platform’s DeFi market share.
Saga Dollar de-pegs after the exploit
Following the exploit, the relatively illiquid D stablecoin de-pegged and fell to all-time lows. The asset crashed to $0.75, further damaging the project’s stability and reputation.
D was launched in early December 2025, expanding its supply to over 6M tokens. The asset was only traded on Saga’s internal Oku Trade market.
Saga also has a native version of Uniswap, which allowed the hacker to cash out some of the stablecoins. Following the exploit, the Saga version of Uniswap lost most of its value locked.
D is the only stablecoin on Saga, with no other bridged assets. The network is yet another relatively new launch, which suffered an exploit while still growing its DeFi sector.
SAGA tokens were already trading NEAR an all-time low, and sank further to $0.053 after the announcement of the exploit. The tokens have been sliding since their launch in May 2024.
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