How a Fake Uniswap Pool Drained $3M From 86 Crypto Wallets Overnight




 A major DeFi exploit on May 25, 2026 drained approximately $3.2 million from 86 Gnosis Safe wallets in under two hours. The incident targeted a third-party contract called the SquidRouterModule, deployed on both Ethereum and Base networks.

What made this attack different from most DeFi hacks was the exit strategy. The attacker held real delegate permissions on the victim Safes but could not directly transfer funds. The module only authorized Uniswap V3 swap actions. So instead of attempting a blocked transfer, the attacker deployed a worthless ERC-20 token, built a fake Uniswap V3 pool, and used the victims' real assets to "swap" into it. Since the attacker owned the liquidity position, pulling the real funds out was straightforward.

It is one of the most technically precise exploits seen on-chain in 2026. The attacker did not break the permissions. They worked entirely within them.

Blockchain security firm Blockaid detected the attack in real time and published the exploiter address and consolidation wallet on X. The consolidation wallet held approximately 3.07 million DAI at time of reporting, funded from wallets pre-loaded through Tornado Cash.

Squid, the cross-chain routing protocol whose name appeared in the vulnerable contract, confirmed its core system was not involved. The SquidRouterModule was built and deployed independently by a third party. Squid's own router contract was untouched.

The exploit raises a broader question for anyone using multisig wallets with third-party modules. Verification on a block explorer does not mean a contract is audited or safe. The SquidRouterModule was verified on Basescan. The source code was readable. The flaw was still there.

For Safe wallet users across Africa and globally who rely on multisig infrastructure for treasury management and team funds, this incident is a clear signal. Every module added to a Safe wallet expands the attack surface. Audited or not, a module granted broad permissions becomes a potential entry point.

Full technical breakdown, on-chain addresses, and the complete attacker walkthrough are covered in detail at CryptoNewsLive.org.

Read the full investigation: https://cryptonewslive.org

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