Yuga Labs has recovered dozens of high-value NFTs after a security exploit hit Flooring Protocol, an Ethereum-based NFT liquidity platform. In total, 68 NFTs were retrieved, including 29 Bored Ape Yacht Club (BAYC) assets and two CryptoPunks, with combined value estimated at over $500,000.
Vulnerability in NFT Liquidity System
The incident occurred on June 8, 2026, when attackers exploited a flaw in Flooring Protocol’s accounting mechanism. The platform allows users to deposit NFTs into pooled smart contracts and receive fractional tokens representing shared ownership.
The weakness reportedly enabled attackers to generate excessive fractional tokens with minimal collateral. This imbalance allowed them to redeem NFTs worth far more than their actual deposits, putting major collections at risk, including BAYC and CryptoPunks.
Rapid Response from Yuga Labs
Yuga Labs, the company behind both collections, quickly stepped in to secure the affected assets. CEO Michael Figge confirmed via social updates that the recovered NFTs have been moved into secure custody until a remediation plan is finalized.
The firm’s vice president of blockchain, known as 0xQuit, also highlighted the significance of the recovery, pointing to the scale and value of the compromised assets.
The coordinated effort prevented further losses after the exploit had already exposed weaknesses in token balance controls within the protocol.
Issues During Platform Wind Down
The exploit emerged during Flooring Protocol’s gradual shutdown process. The platform had already announced in 2025 that it would phase out its NFT services and urged users to withdraw assets before October 15, 2025.
However, ongoing liquidity challenges and reduced operational oversight appear to have left parts of the system vulnerable. Former CEO FreeLunchCapital also noted that personal NFT holdings remained in the protocol during the wind down, which may have increased exposure during the attack.
NFT Market Still Holds Value
Despite a major correction from the 2021 peak, NFTs continue to hold significant market value. Total NFT market capitalization is estimated at around $1.4 billion as of June 2026.
CryptoPunks and BAYC remain among the most valuable collections, with CryptoPunks valued at roughly 339,400 ETH and BAYC at about 90,590 ETH. Floor prices also remain steady at around 32.7 ETH and 9.16 ETH respectively.
Lessons for the NFT Ecosystem
The incident highlights ongoing risks in NFT financialization platforms where users rely on smart contract integrity rather than direct custody. It is expected to renew focus on stronger audits, improved accounting systems, and better risk controls across decentralized finance.
While the immediate damage was contained, uncertainty remains over Flooring Protocol’s long-term future.
