Recently, hackers targeted two cryptocurrency platforms associated with digital entrepreneur Justin Sun, potentially stealing over $115 million worth of digital assets.
According to a report from CNBC on November 23, the first platform to be hacked was the HTX cryptocurrency exchange, formerly known as Huobi. The company disclosed that hackers were able to siphon off approximately $30 million worth of various cryptocurrencies from HTX by exploiting “hot wallets.”
Hot wallets are a type of cryptocurrency hack and refer to wallets connected to the internet for convenient trading and transactions. However, this connectivity also makes them more vulnerable to cyberattacks than “cold wallets” kept offline.
In addition to the funds stolen from HTX, an associated blockchain bridge called Heco Chain was also compromised. Blockchain bridges allow different cryptocurrency networks to interconnect for faster transfer of assets.
As reported by market analytics firm CryptoQuant, losses from the Heco Chain breach are estimated at $85.4 million, primarily consisting of popular stablecoin USDT and Ethereum. A significant amount of HTX’s native HBTC currency is also believed to have been drained.
Following the confirmed attacks, HTX has implemented emergency measures to safeguard remaining assets, including temporarily suspending all deposits and withdrawals on both the HTX exchange and the Heco Chain bridge. The company has also committed to “fully compensate for any losses incurred due to the hot wallet attack,” although no specifics were provided regarding the reimbursement process.
The incidents targeting Sun-linked HTX and Heco Chain happened following a separate hack of cryptocurrency exchange Poloniex earlier in November. Poloniex, backed by Sun, lost approximately $100 million worth of digital assets in the cyberattack. Sun is a prominent figure in the cryptocurrency space and the founder of file storage blockchain Tron.
These recent incidents underscore the ongoing vulnerabilities of both centralized exchanges and blockchain bridges to hacking and theft, highlighting the weak link that centralized points represent in decentralized systems. As the crypto market continues to expand, cyberattacks have become more sophisticated and costly. Many industry experts argue that stronger oversight and security standards are needed for mainstream adoption to take place.
Meanwhile, HTX has stated that they are working diligently to identify the sources of the hacks and prevent further exploits. However, this is unlikely to provide much comfort to users who have lost funds and face an uncertain path to any form of compensation or reimbursement. The company, as well as the broader cryptocurrency industry, have substantial work to do in strengthening security and regaining trust.
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