What happened?
Berachain pushed an emergency hard fork to trap and freeze funds after a hacker drained over $128 million from Balancer V2 Composable Stable Pools. The foundation circulated a new binary and many validators upgraded, but the chain remains paused while oracles, bridges and other infrastructure update their RPCs. On-chain tracing showed large transfers into ETH and laundering attempts, though some assets (about $19.3M in osETH) were recovered, cutting the total losses.
Who does this affect?
First and foremost it hits Balancer users and liquidity providers who saw funds stolen and total value locked plunge, and Berachain users who faced a paused chain and frozen assets. Validators, oracles, bridges, centralized exchanges and custodians all have to coordinate upgrades and reconnections before normal operations resume. Beyond that, auditors, DeFi projects and on-chain analytics teams are pulled into recovery, tracing and reputation work.
Why does this matter?
This matters because a >$100M exploit plus an emergency hard fork erode trust in DeFi and can trigger quick withdrawals and a collapse in confidence for affected protocols. Large swaps of stolen assets into ETH and laundering attempts create selling pressure and short-term market volatility while paused chains and disconnected bridges fragment liquidity. In the longer run, the incident raises doubts about the value of audits, increases regulatory and user scrutiny, and could push capital toward projects with stronger security or more centralized controls.