Huobi Reclaims $8 Million in Ethereum Through a Hacker Bounty

Huobi Global's security breach leads to $8 million loss, but hacker returns funds after receiving white-hat bonus.

Oct 9, 2023 - 12:52
Oct 9, 2023 - 12:52
Huobi Reclaims $8 Million in Ethereum Through a Hacker Bounty
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In September, Huobi Global faced a significant security breach when a hacker managed to compromise one of the exchange's hot wallets. The result was a loss of 5,000 ETH, equivalent to $8 million. 

HTX, associated with Huobi Global, was quick to disclose the hack on September 25. Justin Sun, an investor in Huobi Global and an adviser to HTX, emphasized that the stolen amount, while substantial, was a "relatively small sum" compared to HTX's total assets, which stood at a staggering $3 billion.

Sun announced that HTX would offer the hacker 5% of the stolen Ethereum as a "white-hat reward" to incentivize the return of the funds. Sun also made it clear that if the hacker did not accept the offer within a week, HTX would not hesitate to involve law enforcement. He then took to Twitter to share the good news. The hacker had indeed made "the right choice" by accepting HTX's offer. All the stolen funds were returned, and as promised, the hacker received a white-hat bonus of 250 ETH. 

"We have confirmed that the hacker has fully returned all funds, as promised, and we have also paid the hack a white hat bonus of 250 ETH. Providing full security for user assets is always our goal to strive for!" 

On occasions, cryptocurrency companies have resorted to negotiating with hackers to recover stolen assets instead of involving law enforcement agencies. In several instances, these negotiations have resulted in agreements where a significant portion of the funds is returned, and a reward is offered to the hacker as an incentive to resolve the matter.

During the second quarter of 2023, blockchain hacks surged by 63% compared to the corresponding period in the previous year, as indicated by an Immunefi report published in July. The report highlighted that the majority of these hacks targeted DeFi platforms, resulting in losses of $228 million across 79 separate incidents. In contrast, centralized exchanges, such as HTX, reported losses of only $37 million across two incidents.

Philip Bohmer Philip is a seasoned journalist that brings clarity to the complex world of cryptocurrencies through his articulate and insightful articles. His passion for blockchain technology fuels his writing, making him a trusted voice in the rapidly evolving digital currency landscape.