HTX Outflow Tops $258M After its Recent Hack

HTX, the crypto exchange associated with Justin Sun, has witnessed a substantial net outflow of $248 million since it resumed operations following a significant security breach in the previous month. This notable development raises questions about investors’ confidence in the aftermath of a security breach the exchange suffered.

Following a major security incident in the previous month, HTX temporarily halted withdrawals and deposits.

The breach resulted in a substantial loss of $30 million worth of crypto tokens, compelling the exchange to take swift action to address the situation. In the same vein, two other platforms Poloniex and HECO Bridge linked to Justin Sun were hit and a total of about $200 million was lost in November  

HTX’s Customers Worry over Platform’s Security

DefiLlama data reveals that the net outflow occurred between the exchange’s restart on November 25 and December 10. This trend highlights lingering concerns among clients, suggesting that some users were not fully reassured after the security incident.

With about 33%, Bitcoin holds the largest portion of the exchange’s reserve. The TRX token powered by the Tron blockchain represents 32% while HT, the exchange’s native token accounted for about 14%.

HTX to Fully Compensate Users

Also, the recent outflow underscores the heightened sensitivity of digital assets investors to security-related issues. HTX’s commitment to investigating the security breach and compensating users is a step in the right direction. However, the net outflow signals that further efforts may be necessary to restore confidence fully.

HTX Experiences Security Breach

Recall that in September, the blockchain analytics platform Cyvers detected a security breach in which 5,000 Ether was siphoned from one of HTX’s hot wallets. In a bid to mitigate the impact, HTX took a proactive approach by offering a 5% “white-hat bonus”. However, the hacker was given a seven-day ultimatum to comply with this arrangement. 

Meanwhile, Justin Sun, affirmed that the exchange will take responsibility for covering all the losses incurred by its users. In his words “$8 million represents a relatively small sum in comparison to the $3 billion worth of assets held by our users. It also amounts to just two weeks of revenue for the HTX platform”. 

However, in October, the exchange affirmed the successful retrieval of funds that a hacker had unlawfully taken from its platform. The announcement reflects the company’s commitment to promptly addressing security breaches and safeguarding the assets of its users.