Decentralized trading protocol Ostium has confirmed that trading remains suspended following the recent security incident that drained funds from its public OLP vault.
In its latest update, the protocol said user positions remain open but cannot be modified, while trader margin remains locked inside frozen smart contracts.
The team added that it is still working toward restoring trading and recovering the stolen funds, but has not provided a timeline for either. Ostium said it will continue releasing updates as more information becomes available.
A Security Update: Trading remains paused following the security incident. User positions remain open and unmodifiable, and trader margin remains unmoved in frozen trading smart contracts. The team will continue to provide updates as they become available regarding a timeline…
— Ostium (@Ostium) July 16, 2026
Recovery efforts continue around the clock
According to the protocol, the past 14 hours have been spent coordinating with law enforcement authorities, blockchain security group SEAL 911, and several independent security researchers.
Ostium said multiple teams are working full-time to track the movement of the stolen assets and support the ongoing investigation. The protocol also thanked members of the crypto industry who have assisted since the incident.
The team said resolving the breach remains its highest priority and pledged to continue providing status reports as recovery efforts progress.
The exploit was first detected shortly after it occurred, allowing the protocol to suspend trading contracts before additional activity could take place.
Can frozen contracts improve fund recovery?
Pausing smart contracts after an exploit has become a common response across decentralized finance, particularly when protocols can freeze trading before attackers move deeper into the system.
Recent incidents involving protocols such as Euler Finance and Curve Finance showed that immediate coordination with blockchain security groups, exchanges, and stablecoin issuers can improve the chances of tracing or recovering stolen assets. Even when funds cannot be frozen directly, slowing their movement gives investigators more time to monitor wallet activity and identify possible exit routes.
Whether that strategy succeeds often depends on how quickly attackers attempt to bridge assets across multiple blockchains or convert them into privacy-focused services. Ostium’s decision to suspend trading and keep user margin locked limits additional exposure while investigators monitor the movement of the stolen funds.
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