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John Martin 29 Sep 2023 ◦ 3 min read

Huobi Hack: What Do We Know?

Huobi Hack: What Do We Know?

Huobi Global's HTX cryptocurrency exchange was hacked on September 24, 2023. This resulted in a loss of $7.9 million to $8 million in digital assets. The attack was a cybersecurity breach, and hackers were able to drain millions of dollars from the exchange.

"Red Code. Yesterday, our machine-learning-based system detected a suspicious transaction involving Huobi Global and HTX Global. Despite our attempts to contact us, we did not respond. EOA received 5 thousand ETH ($7.9 million) from Huobi Global's hot wallet"

- Cyvers Alerts (@CyversAlerts) September 25, 2023.

After the incident, the HTX team migrated the hot wallet. It also sent a transaction to the hacker's wallet with the message that it had established its identity. The exchange was offered to voluntarily return the funds by October 2, and receive a reward of 5% of that amount. Otherwise, the platform will appeal to law enforcement authorities.

Later, the hack was confirmed by Tron founder Justin Sun, a member of the HTX advisory board. Additionally, Sun mentioned that the amount of stolen represents only a small portion of the total assets held by the platform's users, which is estimated to be worth $3 billion. He also stated that the loss is equivalent to two weeks of revenue for the HTX.

The incident occurred within two weeks after the cryptocurrency exchange Huobi rebranded as HTX. The offshore trading platform aspires that rebranding will boost its user popularity and lead to more licenses in diverse jurisdictions in the upcoming years.

HTX Reaction

HTX offers a compromise solution to the attacker by requesting a refund and extending a 5% bonus, valid until October 2, 2023. If they agree, the hacker will receive a reward of 345,000 USD. The legal service of the platform does not intend to make claims against attackers.

Cyver reported that its machine learning-based system identified the exploit. This system detects suspicious transactions from the HTX hot wallet platform. Security officials attempted to contact both the management of the centralized trading platform (CEX) and the attacker, but did not receive a response. According to experts, 5 thousand ETH were stolen by attackers.

Additionally, the founder of the TRON revealed the establishment of the SAFU Foundation, which aims to maintain continual readiness for these types of situations. A cold wallet mechanism, with numerous backups and signatures, guarantees complete asset security.

Contrary to Justin Sun's offer of a 5% reward for stolen funds, HTX Global hackers have not taken any action yet. However, they had one week to return the funds, or San emphasized his intent to take legal action.

In Conclusion

The recent Huobi hack, which resulted in a $8 million loss of Ethereum, is familiar in the cryptocurrency industry. Although each hack may differ in specific details, it is well known that exchanges and wallets are susceptible to vulnerabilities that can be exploited by hackers, and the significance of prompt action in these scenarios cannot be overstated. Cybercriminals frequently use mixers and other tactics to impede the tracing of compromised funds.

However, Huobi has fully compensated for the losses, and the funds are secure, as confirmed by Justin Sun, HTX advisor, and founder of Tron. According to Sun, "$8 million is relatively insignificant compared to the $3 billion of assets belonging to our users." Nevertheless, apprehensions regarding Huobi's financial stability resurfaced. Sun also mentioned that the sum of $8 million is relatively insignificant when compared to the $3 billion worth of assets possessed by users. It is crucial for individuals utilizing cryptocurrency exchanges and wallets to fully comprehend the associated potential hazards and implement the necessary precautions to safeguard their assets.

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