What happened
On 28 March 2026, a custom VTSwapHook on Arbitrum was exploited and the connected PoolManager lost ATH and vATH liquidity. The technical mechanism below is a third-party on-chain reconstruction, not a confirmed project disclosure.
A third-party on-chain reconstruction attributes the loss to a midpoint approximation of a logarithmic curve and fee-inclusive reserve accounting; this proposed root cause is medium-confidence rather than a confirmed contract fact.
How it happened
According to that reconstruction, repeated swaps through Uniswap v4 unlock callbacks alternated directions and compounded the pricing error. The analyst reports that internal reserves were credited with gross, rather than net, input.
Protocol details
Evidence
- transaction Arbiscan exploit transaction arbiscan.io
- analysis DeFiLlama defillama.com
- analysis DarkNavy VTSwapHook pricing-error analysis darknavy.org
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