K9 Finance Warns of Shibarium Exit Over Unresolved Bridge Hack Compensation

• K9 Finance DAO has warned that it may leave Shibarium due to unresolved compensation tied to a September 2025 bridge exploit.
• The exploit resulted in approximately $4.1 million in losses, affecting ETH, SHIB, and other bridged assets.
• KNINE tokens worth roughly $717,000 were frozen by K9 Finance, preventing attacker liquidation.
• K9 Finance cited stalled communication with the Shibarium development team after months of private talks.
• The DAO set a firm deadline for restitution and may hold a governance vote if issues remain unresolved.

Shiba Inus Layer-2 blockchain, Shibarium, is facing internal strain after a leading decentralized finance platform warned it may leave the network. K9 Finance DAO, a liquid staking protocol built on Shibarium, publicly raised concerns over unresolved compensation issues linked to a bridge exploit that occurred in September 2025. The platform has set a firm deadline for restitution, placing pressure on the Shibarium development team to respond.

K9 Finance Cites Communication Breakdown With Shibarium Team

K9 Finance shared its position through a statement posted on X, explaining its decision to go public. The DAO stated that it had complied with all requests made by the Shibarium team following the exploit and had engaged in productive discussions throughout the recovery process. According to the statement, communication later ceased without clear guidance or closure.

Over the past several months, K9 Finance DAO has followed every step requested by the Shib team regarding the Shibarium bridge hack and the process to make affected users whole. Throughout this period, we have operated in good faith and maintained multiple private communication…

The DAO emphasized that its public disclosure was not intended to generate controversy. Instead, it said the move aimed to provide clarity to KNINE token holders and uphold responsible DAO governance. K9 Finance added that it had maintained several private communication channels before determining that progress had stopped.

K9 Finance confirmed that it remains open to resolution before the deadline. However, it stated that continued silence would leave the DAO with no option but to reassess its future on the network through a formal vote.

September Bridge Exploit Remains Central Issue

The dispute stems from a bridge exploit on Shibarium in September 2025, when attackers used a flash-loan-based strategy to drain funds. The incident resulted in estimated losses of $4.1 million, affecting ETH, SHIB, and other assets bridged to the network. Emergency measures temporarily paused parts of the ecosystem during the response.

KNINE tokens worth approximately $717,000 were also impacted during the exploit. K9 Finance froze the affected tokens, preventing the attacker from selling or transferring them. The DAO later confirmed that the frozen tokens remained inaccessible from the attackers wallet.

While the Shibarium team restored network operations and introduced additional security updates, compensation discussions have continued without a final agreement. As of now, the Shibarium developers have not issued a public response to K9 Finances deadline or exit warning.

The post K9 Finance Warns of Shibarium Exit Over Unresolved Bridge Hack Compensation appeared first on Blockonomi.