Google's Threat Intelligence Group (GTIG) has confirmed the first AI-generated zero-day exploit capable of bypassing two-factor authentication (2FA). The exploit targets a hardcoded trust flaw in a widely used open-source web administration tool, marking a significant escalation in cybersecurity threats. The discovery, published on May 11, 2026, highlights the growing sophistication of AI-assisted hacking. The exploit, a Python script, was designed to exploit a logic flaw in the authentication process of the unnamed tool. GTIG identified AI-generated code markers, such as organized prompts and fabricated severity ratings, indicating the use of a large language model. Although Google excluded its own AI model from involvement, the threat actors planned a mass exploitation campaign, which was thwarted by Google's intervention and a timely patch. While no specific cryptocurrency platforms were targeted, the incident underscores the vulnerability of 2FA, a critical security layer for crypto exchanges and wallets. The crypto industry is urged to enhance security measures beyond 2FA, as AI-assisted exploit generation poses a growing threat to digital assets.