Gauntlet Shuts New Deposits Into V1 Vaults Over OP Stack Bug Scare

Gauntlet moved fast on Nov. 5, shutting supply queues on its V1 vaults, halting new allocations and scaling back exposure to assets bridged through LayerZero. The trigger: a reported op-reth vulnerability affecting some OP Stack chains. Makers of the call say nothing has blown up yet. “To the best of our knowledge, no exploit has been reported,” the risk curator wrote in its announcement.

What the move actually does matters. Closing a supply queue stops new deposits from flowing into the vaults — it does not, on its own, freeze withdrawals or the lending markets underneath. Gauntlet curates Morpho vaults, hand-picking the markets where depositors' assets land. Under Morpho's V1 design, the supply queue decides which markets get fresh deposits, so emptying it blocks new money at the gate.

Exits run on a different track. Withdrawals use a separate queue and depend on whatever liquidity is sitting in the underlying markets. Borrowing and repayment also live in Morpho's own lending-market contract, so shutting the supply queue doesn't pause them — new loans still need enough collateral and market liquidity. Gauntlet didn't announce any withdrawal, borrowing or repayment freeze.

Gauntlet kept the details thin, saying the restrictions hit V1 vaults without naming specific vaults or chains. The reported issue centers on op-reth, the OP Stack execution client that processes Layer 2 blocks and keeps the resulting chain state. No technical breakdown of the vulnerability was provided.

The caution isn't happening in a vacuum. Frax Finance said earlier on Nov. 5 that LayerZero had temporarily paused certain cross-chain routes as a precaution, adding that its own assets and smart contracts were unaffected and that user and protocol funds were safe.

Gauntlet says the restrictions stay in place until the reported issue is resolved, and it hasn't set a date for reopening the queues. For now, new money waits outside — existing depositors can still try their luck on the way out.