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November saw a series of high-profile breaches in the cryptocurrency world, with hackers targeting five major exchanges – HTX, Poloniex, Heco Bridge, KyberSwap, and Kronos Research – resulting in a staggering theft of $290 million. The alarming frequency of these attacks sends a clear warning signal to both businesses and consumers about the critical need for unified cybersecurity measures.
But the question is what is the fallen empire hiding beneath the doors, another scam looming on the horizon? With HTX having maximum Bitcoin reserve will it impact the market since many are expecting a massive surge in Bitcoin price? Bitcoin recently hit the expected high of $45,000, and if the market stays stable, 2024 will be a great year for it. However, such market activity can make or break momentum. Let’s do a reality check on the latest hack events.
A Cascade of Hacks Raises Questions
According to the Bloomberg report, the HTX exchange, notably linked to industry figure Justin Sun, faced a significant $258 million net outflow after reopening post-hack. Strikingly, two other platforms connected to Sun encountered over $100 million in hacks, raising suspicions of an exit scam within the community.
Moreover, the DefiLlama data revealed that the outflow from HTX occurred between its restart on November 25 and December 10, indicative of the fallout from the security incident. Despite losing $30 million in crypto tokens during the breach, HTX assured clients of investigations and full compensation for hot wallet losses.
The hack is under scrutiny all because of Sun’s association with Poloniex and HECO Bridge, both hacked in November, further deepened concerns. The next on the radar is Sun’s Tron blockchain token TRX, a significant asset at HTX, who faced US fraud allegations earlier this year, with the SEC accusing him of market manipulation. Hence something is not fitting right in this series of hacks and Tron’s connection with fraud activities.
HTX’s Financial Fallout
Despite the hack and losses, HTX, formerly Huobi, remains a top 20 exchange by trading volume, recording $1.6 billion in the past 24 hours, according to CoinMarketCap. However, the breach has sparked worries among digital-asset investors, reminiscent of the collapse of the FTX platform last year.
But Sun assures full compensation for affected users and promises extra rewards for those using the platforms. This effort aims to maintain trust amid challenges and encourage more people to join Tron’s network. Another interesting fact is that most of HTX’s reserves are Bitcoin and TRX tokens, which is in line with Sun’s Tron blockchain projects. Concerns regarding the exchange’s security have been heightened as security firm BlockSec has been unable to resolve the November breach, which included $30 million, and retrieve the stolen assets.