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Graphic reading Osmosis: Nomic Chain Suffers nBTC Double-Spend Exploit, 22.65 BTC Frozen in Attacker's Address
Photo: The Crypto Times

Osmosis Freezes 22.65 BTC After Nomic Double-Spend Exploit

The Crypto Times2 min read5 sources

Why did Osmosis freeze 22.65 BTC?

Osmosis (OSMO) froze 22.65 BTC on Wednesday after a double-spend exploit on the Nomic bridge left 36% of its Alloyed BTC (allBTC) reserves unbacked, prompting a suspension of minting and redemptions.

Key numbers

BTC frozen in attacker's address22.65 BTCvia emergency chain upgrade
nBTC compromised by exploit39.84 nBTC36% of allBTC backing
allBTC circulating supply110.57 allBTC≈$8.6M at current BTC price
Valid Bitcoin backing remaining≈70.73 BTC-equivalent64% of total supply
Shortfall needing community pool cover≈17.19 BTCafter recovering frozen 22.65 BTC

What happened

Osmosis (OSMO) froze 22.65 BTC on Wednesday after a double-spend exploit on the Nomic bridge left 36% of its Alloyed BTC (allBTC) reserves unbacked, prompting a suspension of minting and redemptions. The flaw sat in Nomic's custom forwarding system — a separate Cosmos chain that wraps Bitcoin as a token called nBTC, which feeds into allBTC. An attacker used it to create 39.84 fake nBTC vouchers, a gap that stayed hidden until Nomic paused its chain on September 7. Osmosis validators then locked 22.65 BTC tied to the attacker in an emergency upgrade, and want a community vote to seize it and cover the rest.

Why it matters

Osmosis is one of the biggest decentralized exchanges built in the Cosmos network, and Alloyed BTC was designed to let people trade one simple Bitcoin token instead of juggling several different wrapped versions. This exploit shows that even an indirect bug — on a partner blockchain, not Osmosis itself — can leave a supposedly fully-backed token short of real Bitcoin. Anyone holding or trading allBTC is exposed to that shortfall until Osmosis governance approves a fix, a reminder that wrapped crypto assets are only as safe as every bridge feeding into them.

Who this affects

Marketbearish
Low impact
Wrapped-BTC trust dips; wider crypto market barely moves.
Companybearish
Medium impact
Osmosis and allBTC holders face shortfall, credibility hit.
Competitorsbullish
Low impact
Custodial wrappers WBTC, cbBTC look comparatively safer now.
Industrybearish
Medium impact
Renews scrutiny of custom cross-chain bridge security designs.

Alloyed BTC vs Wrapped Bitcoin, Coinbase BTC, tBTC

Alloyed BTC (Osmosis)allBTC≈$8.6MBasket of wrapped BTC incl. nBTC110.57 allBTCYes — Nomic bridge exploit
Wrapped BitcoinWBTC$9.2BCustodied BTC (BitGo)≈117,000 WBTCNone reported
Coinbase Wrapped BTCcbBTC$8.0BCustodied BTC (Coinbase)≈100,000 cbBTCNone reported
tBTCTBTC$338MDecentralized custody (Threshold)—None reported

As of 2026-09-10

How we got here

  1. Attacker begins exploiting Nomic's forwarding bug to mint fake nBTC

  2. Nomic pauses its chain, exposing the hidden Bitcoin shortfall

  3. Osmosis freezes 22.65 BTC, suspends allBTC minting and redemptions

  4. Osmosis opens governance vote to seize funds, tap community pool

What to watch

  • Governance vote on seizing frozen 22.65 BTC from attacker's addressQ3 2026
  • Community pool contributes ≈17.19 BTC to fully restore allBTC backingQ3 2026
  • Nomic's post-mortem and fix for the forwarding-bridge vulnerabilityQ3 2026

Educational content only. Not investment advice.

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