Woofun AI reports that Taiko's ERC20 Vault on Ethereum was compromised, resulting in financial losses exceeding $1 million. The breach exploited a critical vulnerability within Taiko's cross-chain bridge infrastructure, specifically targeting the verification mechanism for source signal proofs. Attackers successfully constructed fraudulent message proofs that were erroneously accepted as valid on Ethereum L1, despite the absence of corresponding legitimate MessageSent events on Taiko's source chain. This flaw allowed malicious actors to register fake cross-chain messages and subsequently withdraw assets from the vault without authorization.