USDYuga Labs Recovers 68 NFTs After Flooring Protocol Exploit
White-Hat Operation Secures More Than $500,000 in Digital Assets
TL;DR
- Yuga Labs-affiliated developers recovered 68 NFTs after an exploit targeted Flooring Protocol.
- The rescued assets were valued at more than $500,000.
- The NFTs remain in Yuga Labs' custody while Flooring Protocol works toward a fix and return process.
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Yuga Labs-affiliated developers recovered 68 NFTs worth more than $500,000 after an exploit targeted Flooring Protocol, securing the assets before attackers could use a vulnerability to withdraw them from the protocol.
The recovery was disclosed on June 8, 2026. The operation involved a white-hat intervention by Yuga Labs' blockchain security team after a vulnerability was identified in Flooring Protocol's NFT liquidity infrastructure.
Flooring Protocol allows users to deposit NFTs in exchange for liquid tokens. The exploit created a pathway through which attackers could artificially inflate token balances and potentially use those balances to withdraw valuable NFTs from liquidity pools.
Yuga Labs moved the exposed NFTs into secure custody as part of a white-hat rescue operation designed to prevent losses while the vulnerability remained unresolved.
Blue-Chip Collections Were Among the Assets Secured
The recovered assets included NFTs from Bored Ape Yacht Club, CryptoPunks, Mutant Apes, Azuki, Moonbirds, Doodles, Captains and Elementals.
A detailed breakdown identified 29 Bored Ape Yacht Club NFTs, 4 Mutant Apes and 2 CryptoPunks among the rescued assets, with additional NFTs originating from the other affected collections.
Yuga Labs CEO Michael Figge confirmed that the recovered NFTs are being held by the company until an appropriate solution is finalized for returning them to their rightful owners.
Yuga Labs' pseudonymous vice president of blockchain, 0xQuit, said the recovered NFTs were worth more than $500,000.
The NFTs have not yet been returned. Their release depends on Flooring Protocol deploying a fix and establishing a secure process for returning the assets to owners.
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Flooring Protocol Faced Earlier Operational Challenges
Flooring Protocol had already begun winding down parts of its NFT-focused business before the exploit occurred.
In September 2025, the protocol announced that its Web3 consumer services would enter sunset mode and advised FPv2 token holders to redeem their NFTs and exit fractionalized positions before mid-October.
Liquidity constraints and organizational changes left portions of the NFT business without active management.
Former Flooring Protocol CEO FreeLunchCapital said they continued providing liquidity to help users exit positions and left some personal NFT assets on the platform.
FreeLunchCapital said those personal assets became one of the primary targets during the exploit.
FreeLunchCapital also said discussions were ongoing with the parent organization behind the management team in an effort to regain control of the protocol.
NFT Market Context
The exploit occurred during a period when NFT market capitalization had declined from around $2 billion in late April and early May to about $1.4 billion, though the affected collections continued to carry significant value.
The recovery highlights the risks associated with NFT liquidity systems, where vulnerabilities in token accounting mechanisms can expose pooled NFT assets to withdrawal attacks.
FAQ
What happened at Flooring Protocol?
A vulnerability exposed NFTs to potential withdrawal through manipulated token balances.
How many NFTs were recovered?
Yuga Labs-affiliated developers recovered 68 NFTs.
What was the estimated value of the assets?
The recovered NFTs were valued at more than $500,000.
Who currently holds the NFTs?
Yuga Labs is holding the recovered NFTs pending a return process.
This article has been refined and enhanced by ChatGPT.
