The Sandbox plans to compensate eligible SAND holders after an attacker exploited its bridge configuration on Base and BNB Smart Chain, minted unbacked tokens and withdrew SAND from an Ethereum vault.
According to the company’s August 27 post-mortem, the incident began on August 21 at 23:41 UTC. The Sandbox estimated that 14,742,341.84 SAND, then worth about $697,000, was withdrawn from the Ethereum vault. The attacker also sold unbacked SAND into a Base liquidity pool. The company estimated the attacker’s total proceeds from sales and redemptions at about $987,000.
The Sandbox said it closed the affected bridge at contract level across Ethereum, Base and BNB Smart Chain on August 22 at 05:26 UTC. It said SAND on Ethereum and Polygon was not exposed through the affected path. These impact and containment findings are based on the company’s forensic account and have not been independently audited in the material reviewed.
A valid message carried invalid economic value
The post-mortem describes a failure in the relationship between the SAND token contracts and the bridge’s messaging configuration. The Base and BNB Smart Chain token contracts included a general-purpose call feature. Because each token contract was also registered as the bridge application on its network, the messaging layer treated instructions originating from that contract as authorized instructions from The Sandbox.
The attacker used that path to obtain control over a bridge configuration role, make an attacker-controlled address the sole verifier and submit messages for deposits that had not occurred on Ethereum. That allowed unbacked SAND to be minted on Base and BNB Smart Chain.
Some of the unbacked tokens were sold. Others were burned in reverse-bridge transactions, causing the Ethereum vault to release real SAND. The Sandbox said the burns and message delivery were processed through the normal path; the vault could not determine whether the burned tokens had originally been backed by an Ethereum deposit.
The company said no key held by The Sandbox was compromised and no super-operator account was added. Its account instead points to a contract and authorization-design failure: a token contract with a general-purpose call function was also trusted as a privileged bridge participant.
The affected contracts will not reopen
The Sandbox said the Base and BNB Smart Chain contracts are not upgradeable, so the vulnerable function cannot be removed from their deployed bytecode. It also said control over the relevant bridge configuration could be taken again under the existing design. The company has therefore permanently retired the affected contracts rather than attempting to reopen them with revised settings.
Any future bridge to Base or BNB Smart Chain will use new contracts at new addresses. The Sandbox said the replacement architecture will separate the token contract from the bridge application. No deployment date or independent security review for that replacement was disclosed.
The company also warned users not to buy SAND on the two affected networks or send tokens to the retired bridge contracts. It said the unbacked supply on those networks is stranded and cannot be redeemed or moved through the closed route. Official replacement addresses have not yet been announced.
Compensation relies on a pre-incident snapshot
The Sandbox said every wallet that held legitimately bridged SAND on Base or BNB Smart Chain immediately before the first unauthorized mint will be entitled to 1:1 compensation in Ethereum-based SAND. Eligibility will be calculated from onchain snapshots at Base block 50,283,176 and BNB Smart Chain block 117,321,965.
The company plans to fund compensation from its treasury without minting new SAND. It said two centralized exchanges account for more than 72% of the affected balance and will distribute compensation directly to their customers. The exchanges were not named in the post-mortem.
For other eligible holders, The Sandbox expects to open a claim process within two weeks of the August 27 post and keep it open for two weeks. Final eligibility rules, the entitlement list and the official claim interface remain pending. The company said a valid claim will not require a token approval, an offchain signature or a transfer of funds, and warned that direct recovery offers are scams.
Why bridge controls matter to payment infrastructure
The incident illustrates that transaction validation is not the same as asset-backing validation. A bridge can process a genuine burn and a correctly delivered message while still releasing collateral for tokens that were created without a corresponding deposit. Payment and treasury systems that rely on crosschain assets therefore need controls that reconcile issuance, locked collateral and redemption across the full lifecycle.
Role separation is another practical issue. Combining a broadly callable token function with authority over bridge configuration created a path from application behavior to settlement control. Separating those roles, limiting configuration privileges and continuously reconciling liabilities against locked assets can reduce the chance that one contract-level weakness becomes a claim on backing assets.
The announced compensation plan addresses eligible balances, but operational questions remain. Users and counterparties still need the final entitlement list, exact claim dates, verified contract addresses and evidence that any replacement bridge has been independently reviewed before treating the route as restored.