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AllianceBlock has been attacked in a multi-million dollar exploit, according to a Feb. 1 announcement by the DeFi project.

That report indicates that an attacker gained access to 110 million ALBT tokens, which were worth about $12 million prior to the attack.

The price of ALBT has dropped dramatically, as its value fell from $0.11 to $0.04 in a matter of hours after the attack. Further losses are expected.

AllianceBlock said that the attacker breached individual “Troves” — smart contracts controlled by users and used to manage deposits — on the related platform Bonq. AllianceBlock added that its own smart contracts were not compromised.

Unconfirmed reports also suggest that the attacker has gained at least $500,000 of stablecoins by selling Bonq’s BEUR token

AllianceBlock and Bonq are now taking steps to limit the movement of funds. Teams are working to remove liquidity and have paused activity on the Alliance Block Bridge. Both teams are also attempting to halt exchange trading — though no major exchanges have said that they have stopped the attacker from cashing out the stolen funds.

As a solution, AllianceBlock intends to take a snapshot of the network prior to the attack, then create a new ALBT token and airdrop that token to its users.

Any addresses that continues to trade ALBT after the snapshot will not receive the new token. It is unclear whether this will persuade the attacker and legitimate investors to hold the token, or whether it will encourage them to cash out that asset even more quickly.

AllianceBlock intends to provide various services that combine aspects of decentralized finance and traditional finance. It is a relatively minor project in the DeFi arena, reporting a total locked value (TVL) of just $50 million in recent years.

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