White hat MEV actor intercepts $2.6 million stolen from Morpho Labs' DeFi protocol

A white hat actor known for maximizing extractable value (MEV) successfully intercepted approximately $2.6 million in crypto assets stolen from Morpho Labs' decentralized finance (DeFi) protocol. The theft occurred after a front-end update was implemented on the Morpho Blue application on April 10, leading to a vulnerability that was exploited by a hacker the following day. Despite an address losing $2.6 million due to the vulnerability, the security firm PeckShield reported that the funds were intercepted by the white hat MEV operator "c0ffeebabe.eth." The stolen funds had been transferred to a different wallet address at the time of reporting, with uncertainty surrounding their return to the original owner. In response to the incident, Morpho Labs reversed the front-end update and confirmed the safety of all funds within the Morpho Protocol. The team identified and fixed the issue that led to the vulnerability, ensuring that users did not need to take additional actions to secure their assets. The white hat MEV operator "c0ffeebabe.eth" has a history of recovering funds from DeFi hacks, including the retrieval of $5.4 million in Ether (ETH) from the Curve Finance exploit in 2023.