HTX faces $258 million outflow after November hack

Linked to Tron founder Justin Sun, the HTX exchange recorded client outflows of $258 million between November 25 and December 10. The dynamics can be linked to the preceding hacker attack, Bloomberg.

On November 22, the attacker breached HTX’s hot wallet and cross-chain bridge Heco Bridge. The damage amounted to $110 million. It was reported that the consequences of the exchange’s own exploit were valued at $23.4 million.

At the time, Sun vowed that the trading platform would cover the lost funds at its own expense. The organisation also announced plans to reward users with an airdrop.

Four days later, the platform restored operations.

In September HTX lost 5,000 ETH ($7.9 million at the time) as a result of a hot-wallet attack. About two weeks later, the hacker returned the stolen assets for a reward of 250 ETH.

On November 10, the Sun-linked Poloniex was also subjected to an attack of $125 million in cryptocurrencies. Then the platform chief said there was “successful identification and freezing of part of the assets tied to the hacker’s addresses.”

Cryptopolitan saw investor concerns about asset safety in the sequence of events around the platform.

“This lack of trust could have long-term consequences for HTX’s reputation and its ability to attract and retain users,” — they concluded.

Bloomberg explained the dynamics of “increased sensitivity to flows after FTX collapse.”

Commenting on the outflows, a HTX spokesman told the agency in an interview that he represents “a small fraction of the reserves.”

According to Defi Llama, in HTX’s reserve structure the largest share — 32.9% — is Bitcoin. Slightly less (31.8%) is TRX. The share of the exchange’s utility token — HT — is 14.4%, supported by Sun’s token stUSDT — 12.2%.

In March, SEC charged Sun and three of his companies with an unregistered offering of securities in the form of TRX and BTT tokens.

In November, Reuters, citing blockchain-analysts, reported that Iran-backed militant groups have moved from Bitcoin to Tron to fund their activities.