Yuga Labs-linked white hats rescued 68 NFTs value over $500,000 from an exploit on Flooring Protocol on June 8, 2026, after a flaw within the protocol’s accounting mechanism allowed an attacker to inflate fpToken balances, drain liquidity swimming pools, and alternate tokens for NFTs locked within the contract.
The flaw was not restricted to a single remoted pool. It resided throughout the contract mannequin that converts locked NFTs into fungible tokens, leaving each FloorProtocol V2 and BitmapPunks affected.
What Occurred
The exploit focused the mechanism that permits NFTs locked inside Flooring Protocol to be represented by fungible tokens. Based on 0xQuit, VP of Blockchain at Yuga Labs, the attacker used a really small quantity of WETH to generate a near-infinite fpToken stability, thereby draining liquidity from Flooring swimming pools.
After a number of swimming pools have been drained, one other handle continued to make the most of the token value being pushed down to close zero to purchase low cost tokens, redeem them for the underlying NFTs, and promote them. The evaluation group later found an extra associated exploitation path that might have an effect on different swimming pools, together with these containing higher-value NFTs.
FreeLunchCapital, the architect behind the FloorProtocol V2 and BitmapPunks contracts, said that BitmapPunks was additionally affected as a result of it used the same contract construction. Each used a mannequin the place fungible tokens are pegged 1:1 with NFTs locked within the contract, permitting customers to transform backwards and forwards between tokens and NFTs.
A Flooring exploit right now turned a mud quantity of WETH right into a near-infinite fpToken stability, permitting the attacker to empty Flooring swimming pools.
This led to a followup opportunist scooping up tokens from the now depleted swimming pools and exchanging them for underlying NFTs.
1/🧵
— Give up (@0xQuit) June 8, 2026
Based on 0xQuit, the high-value swimming pools had not been attacked primarily because of a scarcity of liquidity on Uniswap. As soon as the white hat group recognized that the exploitation methodology may very well be utilized to different susceptible swimming pools, they determined to execute the rescue instantly to mitigate the danger of one other attacker front-running them.
White Hat Response
Michael Figge, CEO of Yuga Labs, said that the group accomplished a white-hat operation on Flooring Protocol. The belongings secured into custody embody 29 Bored Apes, 4 Mutant Apes, 1 Bored Ape Kennel Membership, 2 CryptoPunks, 1 Azuki, 2 Elementals, 26 Captains, 1 Moonbird, and a couple of Doodles, bringing the overall variety of rescued NFTs to 68.
On this marketing campaign, 0xQuit immediately recovered these NFTs. Coffeedev found the danger that might unfold to different Flooring collections similar to BAYC and CryptoPunks, whereas GrailsOTC offered the upfront funds and NFTs required for the rescue.
0xQuit said that the rescue contract utilized the identical set of flaws defensively to maneuver the at-risk NFTs out of Flooring swimming pools earlier than different attackers might exploit them. The rescued NFTs are valued at over $500,000 and are presently being held to work with related events to return them to their rightful house owners.
How The Exploit Labored
Based on 0xQuit, the exploit stemmed from how Flooring Protocol information NFT possession after the NFTs are locked and represented by fpTokens. The exploit mechanism occurred within the following sequence:
- Creating an entry level: The attacker used a purposefully generated token ID to make the contract affirm possession as if it have been legitimate.
- Skewing the accounting: This token ID brought on the possession test and inside bookkeeping to document mismatched information, making a state of “ghost possession.”
- Inflating the stability: Because the attacker continued to switch or unwrap/burn tokens, subtractions that weren’t correctly checked underflowed, wrapping the fpToken stability right into a near-infinite quantity.
- Draining worth from swimming pools: With the inflated stability, the attacker might drive the pool value down to close zero, drain liquidity, and alternate tokens for the underlying NFTs.
FreeLunchCapital additionally said that the flaw was positioned throughout the bit-level code optimized to scale back fuel charges, which had slipped via a number of rounds of safety opinions.
What Stays Unresolved
The incident remains to be not thought-about absolutely resolved. A number of NFTs stay within the arms of the exploiters, whereas the 68 rescued NFTs are presently in custody in preparation for return to their rightful house owners. 0xQuit additionally warned customers to not deposit extra NFTs into Flooring Protocol, as newly deposited belongings might change into susceptible instantly.
Yuga Labs said it should coordinate with protocol builders, with the potential want for contract relaunches, token reassurances, or different measures to make sure the return course of doesn’t create further dangers. On the operational facet, FreeLunchCapital stated they’re working to regain management from the dad or mum group of the administration group, whereas coordinating with safety groups and exchanges to hint extracted funds and belongings.
Broader Context
The Flooring Protocol incident additionally highlights the dangers of techniques that convert NFTs into fungible liquidity. When NFTs are locked in a contract and represented by tokens, customers aren’t solely uncovered to market dangers but additionally depend upon the protocol’s accounting logic, possession, redemption processes, and liquidity design.
This danger is especially notable as a result of the rescue listing consists of main collections like BAYC and CryptoPunks. If these belongings have been to be redeemed and bought by attackers, the affect might lengthen past Flooring Protocol, particularly for fractionalization tasks using related contract buildings.
