A crypto hacker who stole tens of millions of dollars from the decentralized crypto perpetuals exchange GMX (GMX) is turning white hat by returning the stolen funds to collect a bounty.

In a new thread on the social media platform X, GMX says the hacker who stole $42 million worth of crypto assets earlier this week from its Arbitrum (ARB)-based liquidity pool is returning the funds and collecting a $5 million reward.

“A potential exploitable amount of $42 million belonging to GLP holders was secured. After payment of a $5 million bounty to the user, the remaining funds are now safely in the GMX Security Multisig.

Contributors are working on a proposed distribution plan for presentation to the GMX DAO (decentralized autonomous organization) and will share more information shortly.”

According to previous reports, the hacker struck on July 9th and transferred part of the funds to an unknown wallet. At the time, GMX said the exploit was limited to GMXV1 and that V2, its markets and liquidity pools, as well as the ecosystem’s native asset, were unaffected.

In its report on the incident, GMX says the exploit was a re-entrancy attack, or a type of hack that affects smart contracts by taking advantage of a vulnerability presented when a smart contract makes a call to another before updating itself, leaving open the possibility for an external malicious contract to enter in.

News of the returned fund sent GMX skyrocketing, as the digital asset is trading for $13.36 at time of writing, an 18.4% increase during the last 24 hours.

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The GMX protocol halted trading on GMX V1 after a liquidity pool suffered an exploit on Wednesday, leading to $40 million in funds being stolen and sent to an unknown wallet.

GMX V1 is the first version of the GMX perpetual exchange deployed on the Arbitrum network. The attacked pool provides the liquidity provider of the GMX protocol with a basket of underlying digital assets including Bitcoin (BTC), Ether (ETH) and stablecoins, according to the GMX team.

The protocol has also announced a temporary suspension in minting and redemption of GLP tokens on both Arbitrum and the layer-1 Avalanche network to protect against any additional fallout from the cybersecurity exploit.

Users of the platform were instructed to disable leverage and change their settings to disable GLP minting.

“The exploit does not affect GMX V2, its markets, or liquidity pools, nor the GMX token itself. Based on the available information, the vulnerability is limited to GMX V1 and its GLP pool,” the team said.

Blockchain security company SlowMist attributed the exploit to a design flaw that allowed hackers to manipulate the GLP token price through the calculation of the total assets under management.

Hacks and cybersecurity crimes continue to be major pain points in the crypto industry, affecting both centralized platforms and decentralized exchanges. The hacks have caused billions of dollars in cumulative losses and discouraged new participants from adopting crypto due to the fear of victimization by sophisticated threat actors.

Related: Brazil’s central bank service provider hacked, $140M stolen

Crypto hacks continue to be a feature of the digital asset landscape

Losses from crypto hacks reached $2.5 billion in the first half of 2025, with approximately $1.4 billion in stolen funds resulting from the Bybit hack in February.

In June, Iranian crypto exchange Nobitex fell victim to a cyberattack from a pro-Israeli hacker group called Gonjeshke Darande.

The hack caused over $81 million in losses for the Iranian exchange, which was forced to pause services temporarily to mitigate the effects of the hack.

The United States Treasury’s Office of Foreign Assets Control (OFAC) announced sanctions on Song Kum Hyok, a group of North Korea state-affiliated hackers, on Wednesday.

Song Kum Hyok infiltrated several crypto companies and defense contracting businesses, intending to exploit these organizations from the inside with both social engineering scams and cybersecurity breaches.

Magazine: North Korea crypto hackers tap ChatGPT, Malaysia road money siphoned: Asia Express

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