Solflare, a Solana-based wallet, has paused SOL staking rewards after its validator operator lost control of security keys. The platform clarified that the incident occurred on the staking provider's side, not within Solflare itself, and emphasized that users' delegated stake remains secure.
According to Solflare's statement, delegated stake is held in users' own stake accounts and controlled by their keys alone, meaning user funds were not at risk despite the validator compromise. The team plans to add a new validator and is developing a compensation plan for users who migrate their stake, with the process to occur within the Solflare app.
Solflare co-founder Vidor Gencel noted that while the situation is difficult, no user funds were lost. He explained that Solana's architecture prevents validator keys from accessing delegated stake, keeping user SOL secure in individual stake accounts.
The exact number of affected users and the total amount of delegated SOL requiring migration has not been disclosed. Proof-of-stake chains like Solana rely on validators locking SOL and borrowing delegated SOL from users in exchange for sharing staking rewards.
The incident occurs amid a broader pattern of security challenges across cryptocurrency infrastructure. Earlier security incidents have affected other platforms, including staking providers and hardware wallet services.
Solana staking demand has weakened in October, with net staking outflows reaching 2.4 million SOL during the month. This period coincided with SOL's price declining approximately 15 percent, from around $123 to $105.
