NEAR’s new US exchange-traded fund is undergoing its initial stress test just days after its debut, following a $3.8 million ecosystem exploit that targeted the token.
The token’s price dropped roughly 10% to $4.86 after NEAR Intents revealed a security breach impacting its Omni deposit and withdrawal framework. This downturn happened less than 48 hours after Bitwise introduced the token to US ETF investors under the ticker NRR.
Trading for the fund commenced on NYSE Arca on September 29, drawing $35.5 million in net inflows on day one. According to figures from SoSoValue, cumulative inflows surpassed $50 million by September 30, with total net assets hitting $52.8 million—representing about 0.76% of NEAR’s overall market capitalization.
This timing subjects the fresh investment vehicle to an unusually early trial of investor sentiment. While the ETF shields purchasers from managing wallets, private keys, and direct staking, its valuation remains tied to NEAR, leaving shareholders vulnerable when external ecosystem issues shake confidence in the underlying asset.
A $3.8 million exploit hits NEAR Intents
In a statement published on X, NEAR Intents announced it paused operations temporarily after discovering what it termed a bug within the communication between its Omni infrastructure and the Intents smart contract.
Initial losses hovered around $3.8 million, with project organizers pledging full reimbursement to impacted users. The development team patched the contract flaw, allowing NEAR Intents and near.com to restart services following the brief shutdown.
Certain deposit and withdrawal pathways stayed offline for a longer duration as engineers finished repairs on the Omni infrastructure across multiple networks, including BSC, Polygon, TON, Optimism, Avalanche, Stellar, and Scroll.
Illia Polosukhin, co-founder of NEAR, explained that the attack was restricted to USDT on BSC and that the SHIELD security framework of NEAR Intents flagged anomalous behavior prior to halting operations. He noted that the crew isolated and resolved the flaw within an hour.
Operation of the underlying NEAR blockchain remained uninterrupted throughout the event. NEAR Protocol confirmed that the exploit stemmed from no weakness in the main network or the native NEAR token, allowing block generation and transaction execution to proceed normally.
This division dampens the direct operational fallout for Bitwise’s ETF, which maintains exposure to NEAR rather than funds deposited via NEAR Intents. Even so, the market reaction demonstrates how swiftly application failures can influence an asset newly packaged for mainstream financial participants.
Furthermore, the Intents business operates on a scale significant enough to prevent the incident from being dismissed as a minor ecosystem glitch. Polosukhin reported that the platform currently handles upwards of $4 billion monthly in trading and payment transactions, establishing it as a vital bridge connecting NEAR to other blockchains and programs.
Organizers have notified law enforcement about the breach and are collaborating with blockchain security and analytics firms to track the misplaced funds. A comprehensive postmortem report is anticipated shortly.
Looking ahead, Polosukhin mentioned that the ecosystem intends to broaden its deployment of formal verification alongside other defensive protocols in response to the attack, building on ongoing initiatives to establish a verification standard for NEAR smart contracts.
He stated:
“The crypto space is entering a new era of far more sophisticated cyber attacks. Recently, we have seen BitGet, Metamask, Lido all being targeted by criminals equipped with AI systems that are continuously trying to hack all infrastructure. As a space, we need to be far more vigilant and raise the bar on both onchain contract standards and offchain monitoring and proactive prevention.”
The ETF arrived after leverage had already started leaving
The price contraction also coincided with a market where speculative interest had already shifted notably prior to the commencement of NRR trading.
Data from blockchain analytics provider Santiment revealed that futures open interest denominated in NEAR peaked at approximately 215 million NEAR on September 21, eight days prior to the ETF launch. By September 29, that metric declined by about 21% to 169 million NEAR, even as the token appreciated by roughly 86% beginning September 16.
Open interest measured in dollars kept climbing for several days to touch roughly $1 billion on September 27, though the shrinking quantity of NEAR tied up in derivatives indicated that leverage was already contracting before the ETF became accessible.
This dynamic distinguishes the post-hack price movement from a standard leveraged liquidation wave. According to Santiment, spot accumulation grew ahead of the launch while speculative exposure diminished, assigning a more prominent function to the ETF inflows within the broader market architecture.
The initial two days of NRR trading confirmed institutional demand exists, but the ultimate test unfolds in the aftermath of the breach.
Should capital inflows persist despite the 10% setback, it would indicate that investors are prepared to dissociate an application-level breach from the core investment thesis of the base network. Conversely, a reversal in fund flows would highlight how rapidly an ecosystem security incident can halt enthusiasm for an ETF that has traded for only a few days.