Gnosis Chain Executes Hard Fork to Recover Millions Frozen in November Balancer Exploit

• Gnosis Chain completed a hard fork to recover funds from a major Balancer exploit.

• The hard fork moved frozen assets to a DAO wallet securing them from the hacker.

• Community debate continues over blockchain immutability and governance after the hard fork.

Gnosis Chain has activated a hard fork to recover assets frozen during a major Balancer exploit in November. The network’s decision followed weeks of discussions among validators about technical solutions and governance limits.

LATEST: 🔒 Gnosis executed a hard fork on Monday to recover funds from a November Balancer exploit that saw $116M in digital assets stolen, with the funds now out of the hacker’s control. pic.twitter.com/MvsDfyj6gP

— CoinMarketCap (@CoinMarketCap) December 24, 2025

The hard fork, completed on Monday, allowed frozen funds to move from an attacker-controlled address to a DAO-controlled recovery wallet. Gnosis confirmed that the recovered funds are no longer accessible to the hacker. The action highlights the balance between network security and blockchain immutability.

November Exploit and Initial Response

On November 3, the Balancer protocol experienced a security breach, and more than $116 million in digital assets were stolen. Onchain data revealed that millions of staked Ether were moved to new wallets. Immediate measures focused on containment. Gnosis validators implemented a soft fork to block the hacker’s address. This prevented further losses but left funds frozen and inaccessible to both victims and attackers. The frozen state created urgency for a recovery strategy.

Hard Fork and Technical Implementation

The hard fork became the only solution to recover frozen assets. It required validators and node operators to upgrade their clients promptly. Failure to update risked penalties and potential network disruption. Once the fork activated, it rewrote recent chain history. The process forcibly transferred frozen assets to a recovery wallet controlled by the Gnosis DAO. This step restored control over the stolen funds, allowing the network to move toward reimbursement plans.

The move reflects a careful balance between intervention and maintaining core blockchain principles. Validators coordinated closely to ensure the fork’s execution did not destabilize the network. The recovered funds are now secured while the community continues discussing proper allocation methods.

Recovery Efforts Across Ecosystem

Beyond Gnosis, other networks coordinated recovery actions. StakeWise retrieved approximately $19 million in osETH, and Berachain recovered $12.8 million with help from white hat hackers. Balancer itself reported $28 million recovered through prior interventions but required the Gnosis hard fork to regain majority control. Audits had previously confirmed that the exploit affected only Balancer V2 Composable Stable Pools.

Community Debate and Governance Considerations

The hard fork has sparked debate within the Gnosis community. Some members support it as a necessary recovery measure, while others argue it challenges blockchain immutability. Critics warn that rewriting chain history sets a precedent for future interventions. Supporters stress the collective validator action aimed to protect user funds and stabilize the network. Community discussions now focus on claims processes and recognition for contributors involved in recovery efforts.

The hard fork marks a pivotal moment in balancing network security and governance. It restores control over the frozen assets while leaving broader governance questions open for discussion.