Huobi Global’s cryptocurrency exchange has successfully recovered $8 million in stolen Ether (ETH) after negotiating directly with the hacker responsible for the theft. This remarkable outcome sheds light on the evolving landscape of cybersecurity within the cryptocurrency industry.
The Hack and Recovery
The saga began on September 25, 2023, when Huobi Global disclosed that one of its hot wallets had been compromised, resulting in the theft of 5,000 ETH. Despite this setback, Huobi Global’s investor and HTX adviser, Justin Sun, reassured customers that the amount stolen was relatively small compared to the exchange’s extensive holdings, which stood at approximately $3 billion.
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However, instead of immediately involving law enforcement agencies, the exchange took an unconventional approach. Justin Sun, in an X (Former Twitter) announcement on October 7, revealed that the hacker had voluntarily returned all the stolen funds, keeping their promise made during negotiations.
In an unexpected twist, the hacker was also awarded a “white hat bonus” of 250 ETH for their cooperation. Sun stated in his post:
“We have confirmed that the hacker has fully returned all funds, as promised, and we have also paid the hacker a white hat bonus of 250 ETH.”
This outcome not only highlights the determination of Huobi Global to protect its users’ assets but also showcases a growing trend within the crypto industry: negotiating with hackers to recover stolen funds. Earlier, similar acts were observed by Curve Finance hackers as they returned 5,495 stolen ETH to JPEG’d, as reported by Todayq News on August 5, 2023.
Rising Crypto Hacks
Cryptocurrency exchanges and platforms face continuous security threats, as evidenced by recent data. A report by Immunefi from July 2023 revealed a 63% increase in blockchain hacks during the second quarter, compared to the same period the previous year.
Notably, the majority of these hacks occurred on Decentralized Finance (DeFi) platforms, resulting in losses of about $228 million across 79 incidents. In contrast, centralized exchanges, like Huobi Global, experienced fewer incidents, with reported losses totaling $37 million across just two cases.
As the cryptocurrency industry continues to evolve, exchanges and platforms must remain vigilant and proactive in safeguarding user assets while exploring innovative approaches to counteract the ever-present threat of cyberattacks.