Polkadot Asset Hub: XCM Bug Desynced dotUSD Supply, Treasury LP Hit

Est. $1.3M reduction to the Polkadot Treasury's liquidity position, per Polkadot's forum notice. User wallets and funds not affected, per the notice.

Root cause: Per Polkadot's forum notice: an XCM issue caused approximately 4.06M dotUSD to be removed from the recorded token supply while the tokens stayed in the DOT/dotUSD liquidity pool; arbitrage traders targeted the resulting pricing imbalance. The precise XCM code path is not yet published.

Timeline, as sourced: Weekend of 24 to 25 Oct 2026 (start Unknown). Fixed via a whitelisted caller referendum; forum notice 26 Oct 21:44 UTC. OpenGov referendum on corrective actions and a post-mortem to follow.

Polkadot Asset Hub, weekend of 24-25 Oct 2026.

Per the forum notice (forum (opens in a new tab), linked by @PolkadotDevs (opens in a new tab)): the Polkadot Technical Fellowship found an XCM issue and executed a whitelisted caller referendum to resolve it. The bug caused approximately 4.06M dotUSD to be removed from the recorded token supply while the tokens stayed in the DOT/dotUSD liquidity pool. Arbitrage traders targeted the resulting pricing imbalance, an estimated $1.3M reduction to the Polkadot Treasury's liquidity position. The bug is fixed; impacted assets were moved to a controlled account. User wallets and funds were not affected, per the notice. An OpenGov referendum on corrective actions and a full technical post-mortem are to follow.

Unknown: the precise XCM code path, the start time, and who took the arbitrage.

Pattern: when an asset's recorded supply and the tokens actually held disagree, the pool's price follows the wrong number.