The Sandbox Faces Exploit as Hackers Mint Billions in Unauthorized SAND Tokens

The Sandbox has reported a significant security breach affecting its SAND OFT on Base, where attackers exploited the LayerZero delegate permissions to mint unauthorized SAND tokens. According to blockchain security firm Blockaid, the exploit has resulted in the minting of approximately $49 billion in face-value SAND across more than 400 transactions.

The ongoing attack was identified on August 22, 2026, leading The Sandbox to confirm that its cross-chain bridge on both Base and the BNB Smart Chain (BSC) was compromised. In response, the team has halted all bridging activities to isolate the affected tokens and prevent further unauthorized transfers or redemptions.

The Sandbox stated that the exploit impacted less than 0.01% of the total SAND supply, with tokens on Ethereum and Polygon remaining unaffected. The project reassured users that their wallets were not compromised and that the Ethereum reserves backing the bridged SAND are intact.

As a precaution, The Sandbox has advised users against trading SAND on Base and BSC. The team is currently preparing a snapshot of the affected pools and is working on a compensation plan for eligible liquidity providers. A full incident report and technical post-mortem will be released following the investigation.

In light of the exploit, several Korean exchanges, including Bithumb and Upbit, have suspended SAND deposits and withdrawals, citing security concerns. This incident is part of a broader trend, with multiple exploits reported in the DeFi space this month, particularly targeting bridge vulnerabilities.