In a significant incident, the 1inch Network suffered a $5 million cryptocurrency hack in March 2025. The attack affected multiple tokens including 1INCH, WETH, and USDC. Though the incident led to a notable drop in TVL from $1.6 billion to $1.4 billion, the 1inch Network successfully recovered 90% of the stolen funds. This event highlights the growing need for robust smart contract security within DeFi protocols as reported by experts. Sergej Kunz, co-founder of 1inch Network, has emphasized the importance of frequent smart contract audits and this sentiment aligns with Ethereum’s co-founder Vitalik Buterin’s calls for regular upgrades. This situation underscores the urgency to strengthen system vulnerabilities and address security loopholes. The Coincu research team suggests that a surge in hacking incidents across the crypto market might pose challenges for DeFi regulation, highlighting the need for enhanced security measures and investor protection.