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ETH 
SAND Core Points
A malicious actor broke The Sandbox's smart contract on the Base network and minted approximately 14.9 billion SAND tokens without authorization.
The actual economic loss was about 14.75 million SAND extracted from the Ethereum network, and the hacker's profit was about US$675,000 (80 Ethereum).
The project immediately suspended the cross-chain bridge function on Base and BNB intelligent chains.
South Korea's major cryptocurrency trading platforms Upbit and Bithumb have suspended trading activities in SAND.
Tokens on the Ethereum and Polygon networks remain secure and no individual user wallets have been compromised.
Incident history
On August 22, 2026, a security breach gave an unauthorized party the ability to minte tokens without restrictions on The Sandbox's SAND smart contract. The contract runs on the Base network and uses Layer Zero's Omnichain Fungible Token framework to realize multi-chain token transmission.
The attacker used the "approveAndCall" mechanism to usurp LayerZero's delegated authority. This security vulnerability allows attackers to create unauthorized tokens on the Base network that are not locked in legal SAND reserves on Ethereum as collateral.
Cybersecurity company Blockaid detects ongoing exploits in real time. PeckShield independently verified that approximately 14.9 billion SAND tokens were fraudulently generated in two wallet addresses-a figure far exceeding SAND's legitimate supply of 3 billion on the Ethereum main network.
The widely circulated figure of $49 billion is calculated based on the market value of SAND and the number of illegal tokens. This figure does not reflect actual stolen assets. It far exceeds available market liquidity and cannot be converted into cash.
The real financial impact is much smaller. BlockWatchdog records show that approximately 14.75 million SAND were extracted from Ethereum's OFT adapter in 60 seconds, generating a gain of approximately 80 Ethereum, equivalent to approximately US$675,000.
According to The Sandbox's official statement, when directly calculated, this security breach affected less than 0.01% of SAND's total circulation of 3 billion tokens.
The Sandbox's Incident Response Service
The development team immediately disabled the two-way cross-chain bridge function to Base and BNB intelligent chains, making it impossible to move and redeem tokens on these networks. The project's multi-signature wallet also removed the LayerZero peer nodes of Ethereum and BNB smart chains, successfully isolating the Base network.
Users receive an emergency warning not to buy, sell or exchange SAND on Base or BNB networks due to contaminated liquidity. SAND holdings on Ethereum and Polygon are confirmed as unaffected. The SAND reserve locked on Ethereum to support cross-chain operations remains completely secure.
Korean trading platforms reacted quickly. Upbit issued a transaction alert, and Bithumb suspended SAND's recharge and withdrawal services after a blockchain monitoring alert warned about the vulnerability.
The Sandbox is part of Animoca Brands and received US$93 million in financing in 2021. The project announced plans to take a snapshot of the incident before it occurred and develop compensation measures for affected liquidity pool participants.
Comprehensive technical analysis will be released soon. As of press time, the development team has not yet released a complete public explanation of the root cause of the vulnerability.
SAND fell nearly 10% in the trading session after the breach, but then recovered, falling only 0.8% over the full 24-hour cycle.
Security implications
This security incident highlights an existing systemic vulnerability in the multi-chain token architecture. Creating tokens on the auxiliary chain will not increase the supply of Ethereum, but these unsupported tokens can still enter the trading platform and cause downward pressure on prices.
Investors should pay close attention to Upbit and Bithumb's announcements about resuming trading and wait for The Sandbox's formal resumption strategy or token destruction proposal.
