Matcha Meta users caught in $16.8M SwapNet smart contract exploit on Base
Decentralized exchange (DEX) aggregator Matcha Meta has become the latest protocol indirectly pulled into a major decentralized finance exploit, after one of its core liquidity providers, SwapNet, was compromised in a smart contract attack that siphoned away up to $16.8 million on the Base blockchain.
The incident underscores a long-standing structural risk in DeFi: even if a front-end platform or aggregator maintains secure infrastructure, its users can still be exposed through third-party smart contracts they’ve approved in the past.
How the SwapNet exploit hit Matcha Meta users
On Sunday, Matcha Meta disclosed that it had been affected via SwapNet, a liquidity source integrated into its routing system. According to the team, the issue did not originate from Matcha Meta’s own contracts or infrastructure, but from a vulnerability in SwapNet’s router contract.
The key vector was token approvals. Users who had previously granted SwapNet permission to move their assets — in particular those who had turned off one-time approval safeguards — were at risk. Once the SwapNet contract was exploited, the attacker could leverage those existing approvals to move user funds without additional confirmation.
In a public warning, Matcha Meta urged users to immediately revoke all approvals granted to SwapNet’s router contract to minimize any further losses. The emphasis on approvals highlights one of the most misunderstood, yet critical, aspects of interacting with DeFi protocols.
Conflicting estimates: $13.3M to $16.8M drained
Blockchain security firms have published slightly different tallies of the stolen funds, reflecting the complexity of tracking real-time, multi-step exploits across addresses and chains.
– One security company estimated the loss at roughly $13.3 million.
– Another firm put the figure significantly higher, at at least $16.8 million stolen on Base alone.
According to on-chain analysis, the attacker converted around $10.5 million in USDC into approximately 3,655 ETH, then began bridging part of the stolen Ethereum to the main Ethereum network. Moving funds into ETH and bridging them out is a common laundering pattern used by exploiters to obfuscate the trail and tap into deeper liquidity.
The technical flaw: arbitrary call in SwapNet’s contract
Security researchers traced the exploit to an “arbitrary call” vulnerability in a SwapNet smart contract. In practice, that meant the contract allowed the attacker to make calls that weren’t properly restricted, enabling them to transfer assets that users had previously approved for use by SwapNet.
Instead of only executing intended swap functions under strict conditions, the contract could be manipulated to move tokens wherever the attacker wanted, so long as the contract had spending approval for those tokens.
This kind of flaw highlights why permission scope and access control remain central issues in smart contract engineering. A single unchecked call or overly permissive function can turn a widely used contract into an attack surface affecting thousands of users.
Matcha Meta’s stance and unanswered questions
Matcha Meta stressed that the exposure came solely through its integration with SwapNet and that its own smart contracts were not directly compromised. Still, from a user’s perspective, the distinction is cold comfort: many traders interacted through Matcha Meta’s interface and trusted its curated liquidity sources.
Key unresolved questions remain:
– How many Matcha Meta users were actually impacted?
– To what extent will the project or SwapNet consider compensating affected users?
– What criteria will Matcha Meta use for future liquidity integrations to prevent similar cascading risks?
As of publication, the team had not publicly detailed any concrete compensation framework or specific new safeguards beyond the immediate advice to revoke approvals.
Another chapter in a growing trend of smart contract exploits
The SwapNet incident landed just two weeks after another high-profile smart contract exploit that hit the offline computation protocol Truebit. That attack drained around $26 million and triggered a collapse of more than 99% in the price of its TRU token.
Taken together, these events reflect a broader pattern: the most catastrophic crypto hacks are often not classic account compromises, but failures in smart contract design or implementation.
According to year-end data from a blockchain security report for 2025:
– Smart contract vulnerabilities were responsible for 30.5% of all identified crypto exploits, spread across 56 separate incidents.
– Account compromises and hacked social media accounts (including X profiles) came in second, representing 24% of incidents.
Smart contracts, by design, are immutable and permissionless once deployed. This provides transparency and removes centralized control, but it also means that any bug, misconfiguration, or overlooked edge case can be exploited at scale, with no easy way to “roll back” the damage.
The approval problem: why revoking is so important
The SwapNet case once again shines a light on token approvals — a necessary but risky part of interacting with DeFi.
When users trade on DEXs or aggregators, they typically must:
1. Approve a token for use by a smart contract (granting that contract permission to spend up to a specified limit of that token).
2. Execute the actual swap or transaction.
If the approval is:
– Unlimited (infinite): The contract can spend any amount of that token at any time, as long as the approval stays active.
– Limited or one-time: The contract can access only up to a specific amount, reducing potential downside if something goes wrong later.
Many users, for convenience, accept unlimited approvals to avoid repeated approval transactions and gas fees. However, this means that if the approved contract is ever exploited, the attacker may drain any approved tokens from user wallets without further user input.
The immediate call from Matcha Meta to “revoke all approvals” to SwapNet’s router is a response to exactly this kind of structural risk.
Practical steps users can take after an exploit
Although the exploit targeted SwapNet, the incident provides a textbook checklist for anyone active in DeFi, regardless of which platforms they use:
– Audit your approvals regularly: Use on-chain tools or wallet interfaces that show which contracts have permission to spend your tokens.
– Revoke outdated or unused approvals: If you no longer use a protocol, revoking its approvals limits potential damage from any future exploit.
– Prefer limited approvals where possible: Even if it adds extra transactions, granting only what you need for a specific trade reduces exposure.
– Segment your funds: Keep long-term holdings in more secure wallets and use separate hot wallets for active trading and DeFi experiments.
– Stay informed: In the early hours of an exploit, fast-moving, verified information can be the difference between safety and loss.
AI: a double-edged sword in DeFi security
Security teams warn that advances in artificial intelligence are rapidly changing how vulnerabilities are both discovered and exploited.
On the one hand, generative AI tools have already been used to uncover significant smart contract flaws:
– In December, commercially available AI agents — including advanced models such as Claude Opus 4.5, Claude Sonnet 4.5, and GPT-5 — collectively identified smart contract vulnerabilities representing an estimated $4.6 million in potential exploits across existing protocols.
These systems can quickly scan large volumes of code, simulate interactions, and propose novel attack paths that might escape traditional audits.
On the other hand, the same capabilities can be leveraged by attackers. Malicious actors can:
– Use AI to automate code analysis and search for weak points.
– Rapidly prototype and refine exploit strategies.
– Generate phishing content and social engineering campaigns that are more convincing and tailored to individual targets.
The net result is an arms race where both defenders and attackers are amplifying their abilities with increasingly powerful AI tools.
Social engineering and account hacks still matter
While smart contract bugs now lead the statistics for total crypto losses, more “traditional” attacks have certainly not disappeared.
Account compromises and hijacked social media profiles continue to play a major role in DeFi losses. Compromised X accounts, for example, have been used to post fake upgrade notices, malicious links, or phishing prompts that trick users into signing approvals or revealing wallet recovery phrases.
In parallel, scams combining romance, AI-generated personas, and high-yield investment pitches have led some investors to lose entire retirement savings. These schemes don’t require sophisticated smart contract hacking at all — just psychological leverage and convincing digital identities.
Why DEX aggregators face unique trust challenges
DEX aggregators like Matcha Meta are designed to help users find the best trading routes across multiple decentralized exchanges and liquidity sources. This offers better pricing and efficiency, but it also creates an additional layer of trust:
– Users trust the aggregator’s smart contracts and interface.
– They implicitly trust the integrated liquidity providers and routers that the aggregator chooses to connect to.
If even one of those underlying liquidity sources has a flawed contract, the exposure can propagate out to the aggregator’s user base. The SwapNet exploit illustrates that integration risk — a protocol can be technically secure in isolation but still become a vector for loss if its partners are compromised.
This raises important questions for the entire DEX aggregation sector:
– Should aggregators tighten technical and security criteria for integrated pools and routers?
– Will they require third-party audits and continuous monitoring?
– Could dynamic risk scoring or user warnings become standard when routing through less-tested contracts?
How protocols can harden their defenses
While no system can be made completely immune to exploits, there are clear steps that DeFi projects and their partners can take to reduce the likelihood and impact of similar incidents:
– Stricter contract design and testing: Limiting arbitrary external calls, enforcing strict access control, and thoroughly testing edge cases before deployment.
– Multiple independent audits: Having contracts examined by more than one reputable security team, and maintaining ongoing relationships for post-deployment monitoring.
– Bug bounty programs: Incentivizing white-hat hackers to disclose vulnerabilities responsibly instead of exploiting them.
– Modular architecture: Designing systems so that a failure in one module does not automatically compromise all user funds or other parts of the protocol.
– Emergency pause mechanisms: Carefully designed, transparent controls that allow teams to halt risky contract functions in the event of an exploit.
The road ahead for users and builders
The SwapNet exploit impacting Matcha Meta users is another reminder that DeFi’s composability — the ability to plug different protocols together like financial Lego bricks — is both its greatest strength and one of its deepest vulnerabilities.
For users, it reinforces the need to:
– Understand what token approvals actually mean.
– Treat every new interaction with a smart contract as a decision about risk, not just convenience.
– Regularly clean up wallet permissions and keep large holdings in more secure setups.
For builders and protocol teams, it highlights the responsibility that comes with integrations. Every new partner and contract added to a routing stack expands the potential attack surface. Careful due diligence, proactive security measures, and transparent communication during incidents are no longer optional — they are foundational to maintaining trust.
As the industry leans more heavily on automation, AI-driven security tooling, and complex inter-protocol relationships, the stakes will only rise. The Matcha Meta–SwapNet case is unlikely to be the last such incident, but the lessons it offers now can meaningfully reduce the damage of whatever comes next.