FLOW Token Drops 40% After Flow Blockchain Security Breach

The Flow blockchain is under scrutiny following a significant security incident that has rocked the network. The Flow Foundation, over the weekend, affirmed that it was exploring a possible exploit that caused such a drastic drop in the value of the FLOW token, which fell by over 40%. This attack has led to the halting of FLOW token transfers in major South Korean exchanges, such as Upbit and Bithumb, and analysts are estimating that millions of dollars of digital assets have been stolen. This event underscores the growing vulnerability of the crypto landscape and questions the safety of blockchain systems such as Flow, which previously were widely popular.

Flow Blockchain Under Investigation Following Exploit

The Flow Foundation issued an official statement on Saturday that it was investigating a possible security breach on the blockchain. The Foundation states that their engineering teams have been in close collaboration with network partners to address the problem. The team wrote, “The Flow Foundation is currently investigating a potential security incident affecting the Flow network. Our engineering teams are actively collaborating with network partners to mitigate the issue. We will provide further, verified updates as soon as they are available.”

$4 Million Stolen in Attack on Flow Blockchain

One of the first analysts to spot the potential exploit was on-chain analyst Wazz. According to the analysis provided by Wazz, an attacker minted millions of wrapped FLOW (WFLOW) tokens with the help of a wallet that was created six months ago. The attack has been believed to be associated with a private key compromise and not a flaw in the smart contract. 

Security expert Taylor Monahan also weighed in, stating that the Flow blockchain had [a potential vulnerability] that enabled the attacker to mint the native token, FLOW, and other bridged tokens such as WBTC, WETH, and stablecoins. Monahan also approximated that the stolen amount of funds was about 3.9 million dollars.

FLOW Token Crashes Amid Security Concerns

Following the attack, the FLOW token plummeted by over 40% in a few hours. The token was trading at around 0.10, as compared to 0.17 earlier in the day, with the trading volumes increasing to more than 223 million. The sudden crash caused panic selling in the market, and this added to the volatility.

FLOW 24-hour Price Chart, December 27th, 2025: Source: CoinMarketCap

South Korean Exchanges Halt FLOW Token Transfers 

Following the hack, large South Korean cryptocurrency exchanges, such as Upbit and Bithumb, immediately halted the deposit and withdrawal of the FLOW token. The Digital Asset Exchange Alliance (DAXA), the major five crypto exchanges in Korea, released an official statement of a “transaction risk warning” on the token. DAXA further stated that they might take further steps, such as potential trading bans or withdrawal of support, as the investigation continues.

Flow Blockchain Faces Struggles Amid NFT Market Decline 

The Layer 1 blockchain created by Dapper Labs called Flow has been utilized mostly by consumer applications and digital collectibles. It supported massive NFT platform projects at their peak, such as NBA Top Shot and CryptoKitties, which generated millions of dollars in volume. Nonetheless, with the NFT market turning cold, Flow has not been able to sustain its pace. Dapper Labs, which is worth 7.6 billion dollars as of 2021, has been forced to conduct several layoffs since 2022. This hack is another attack on the reputation of Flow in the blockchain space.

Final Words: Security Incident Raises Concerns for Flow Blockchain

With the Flow Foundation still investigating the breach, the incident highlights the mounting safety issues regarding blockchain networks, particularly during a year of historic levels of cryptocurrency thefts. As the industry is already facing over $3.4 billion in stolen assets in 2025, events such as this one are a clear reminder of the weaknesses that still exist in the crypto ecosystem. At present, the Flow blockchain and the FLOW token have an uncertain future ahead as stakeholders wait to get updated about the situation.

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Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments are highly volatile and risky. Always conduct your own research and consult with a qualified financial advisor before making any investment decisions.