Decentralized finance (DeFi) platform Garden Finance has temporarily taken its application offline after a security incident involving the infrastructure of an independent network participant. The company emphasized that its core protocol and users' funds were not compromised, although approximately $450,000 in USDT belonging to one solver was reportedly stolen.
The temporary suspension allows the team to investigate the incident, strengthen security measures, and ensure the platform can safely resume operations.
Attack Targeted an Independent Solver
According to blockchain security firm Blockaid, the attacker drained roughly $450,000 in USDT from hash time-locked contracts (HTLCs) operating across Ethereum, Base, Arbitrum, and BNB Smart Chain.
However, Garden Finance later clarified that its smart contracts and protocol infrastructure were not hacked.
Instead, attackers reportedly gained unauthorized access to the off-chain database used by one independent solver. By manipulating transaction records, they were able to trigger cryptocurrency payouts for swaps that had never actually been funded.
The company stressed that the incident was limited to the affected solver and did not impact the broader Garden Finance network.
No Customer Funds Were Lost
Garden Finance confirmed that user funds remained safe throughout the incident.
According to the project, only assets owned by the compromised solver were affected, while customer funds and protocol reserves remained fully protected.
The platform also explained that it does not directly manage the infrastructure operated by independent solvers, which are responsible for executing swaps within the decentralized network.
As an additional precaution, Garden Finance temporarily disabled access to its application while engineers reviewed system security and isolated the affected infrastructure.
How HTLC Technology Works
Garden Finance relies on Hash Time-Locked Contracts (HTLCs) to facilitate cross-chain asset swaps.
HTLCs act as decentralized escrow contracts, allowing cryptocurrencies to be exchanged across different blockchain networks only after predefined conditions have been met.
According to the company, these smart contracts continued operating correctly during the incident and were not exploited by the attacker.
Instead, the vulnerability originated entirely outside the blockchain, within the compromised operational environment of an independent solver.
Investigation and Recovery Efforts Continue
Garden Finance has partnered with blockchain security specialists, including Blockaid, Quantstamp, and zeroShadow, to investigate the attack and trace the stolen assets.
The company says its immediate priorities include:
- securing the affected infrastructure;
- tracking the stolen cryptocurrency;
- reviewing additional security controls;
- verifying the total financial impact;
- safely restoring platform services.
Although no timeline has been announced, Garden Finance stated that the application will return online only after completing all necessary security reviews.
Not the First Solver-Related Incident
This is not the first security event involving an independent solver connected to Garden Finance.
The company revealed that in October 2025, another solver's operating environment was compromised, resulting in losses of approximately $11.4 million.
Similar to the latest incident, the protocol itself remained secure, and customer funds were not affected.
These recurring attacks highlight the importance of securing not only blockchain smart contracts but also the off-chain infrastructure that supports decentralized financial services.
Security Remains a Major Challenge for DeFi
The Garden Finance incident comes during a period of increasing cybersecurity threats across the cryptocurrency industry.
Recent attacks targeting DeFi platforms have demonstrated that vulnerabilities often exist outside blockchain protocols themselves, including wallet infrastructure, databases, third-party services, and operational systems.
As decentralized finance continues to grow, projects are placing greater emphasis on infrastructure security, continuous monitoring, and collaboration with cybersecurity firms to reduce operational risks.
Why This Matters
Although Garden Finance's blockchain protocol remained secure, the incident demonstrates that decentralized ecosystems are only as strong as the infrastructure supporting them.
For crypto investors, the event is another reminder that operational security extends beyond smart contracts and includes every component involved in processing transactions.
As the DeFi industry matures, strengthening off-chain systems will become just as important as protecting blockchain networks themselves.
