Origin Protocol halted its eETH Autonomous Risk Manager after a bug bounty report identified an unexpected interaction between the ARM's withdrawal accounting and a recent upgrade to Ether.fi's withdrawal contract. No user funds were lost or exploited.
The announcement said the pause will last approximately seven days while Origin remediates the issue. During that period, the eETH ARM will continue earning lending yield through Morpho but will not generate eETH arbitrage yield, the primary revenue source for the product.
An ARM, or Autonomous Risk Manager, is a smart contract wrapper that deposits user capital into multiple yield sources simultaneously. Origin's eETH ARM previously directed liquidity to both Morpho lending markets and Ether.fi's staking rewards. The Ether.fi upgrade that triggered the bug appears to have created an accounting mismatch when the ARM attempted withdrawals, though Origin did not disclose technical specifics pending remediation completion.
To offset lost arbitrage yield during the pause, Origin added Merkl incentive rewards targeting 3% to 3.5% annualized yield for liquidity providers. Merkl is a rewards distribution protocol owned by Morpho Labs. Origin said LPs do not need to take action to receive the incentives and that the stETH and sUSDe ARMs remain unaffected by the pause.
Origin's longer-term plan, announced in the same post, is to migrate eETH ARM users to a new multi-asset WETH ARM. The company said it would share more details about the new ARM next week and would provide migration timing and instructions through its dapp once public deposits are enabled.
The eETH ARM pause represents a narrow remediation rather than a systemic failure. The bug was identified through Origin's own bounty process before exploitation, and yield accrual through Morpho continues, reducing capital drag during the downtime. The seven-day timeline indicates a contained issue rather than a major architectural rewrite.
