November 23, 2023

Heco Bridge and HTX Exchange Lose $110 Million to Coordinated Cyberattack

In a coordinated cyberattack, both the Heco Bridge infrastructure and the HTX exchange fell victim to hackers, resulting in a combined loss of $110 million in cryptocurrency.

The Heco Bridge and HTX exchange, integral components interlinked through the transfer of assets to the Heco chain, suffered a substantial blow in a cyberattack totaling $110 million.

While initially appearing as separate incidents, both hacks were executed by the same malicious entity, evident in the similarity of the exploit techniques deployed.

As a precautionary measure, the HTX exchange temporarily halted withdrawals from its platform.

The breach affected the Heco Bridge infrastructure, a crucial asset transfer bridge for the HECO blockchain, and the HTX crypto exchange.

Approximately 10.145 ETH, alongside various other cryptocurrencies such as USDT, HBTC, SHIB, UNI, USDC, LINK, and TUSD, were taken, with a total estimated value of $86.84 million.

The stolen USDT funds were promptly converted to ETH to prevent asset freezing by Tether, while other coins were dispersed across multiple addresses.

The initial transfer of all funds occurred through a specific wallet, with Wintermute research chief Igor Igamberdiev and blockchain analysts PeckShield being the first to report the exploit to the crypto community.

PeckShield highlighted the possibility of a connection between the hack and a recent attack on the Poloniex exchange, both owned by multibillionaire Justin Sun.

HTX, also operated by Justin Sun, reported a crypto exploit amounting to $23.4 million, mirroring the operational similarities of the Heco Bridge hack. Outgoing transactions from HTX closely followed those from the bridge.

Arkham Intelligence reported the suspension of withdrawals by HTX to prevent further capital leaks.

Justin Sun reassured clients that all stolen funds would be fully compensated by HTX, emphasizing the safety of the exchange platform's assets.

The cumulative losses from the Heco Bridge, HTX exchange, and the recent Poloniex hack reached $235 million. Despite the financial impact, Justin Sun's reputation within the crypto industry remains intact, given his substantial wealth.

The string of exploits in the fourth quarter of 2023, including the Heco Bridge and HTX incidents, underlines the resurgence of crypto hacks, totaling over $500 million.

The Mixin network also faced a database attack, resulting in a $200 million loss. The increasing frequency of such attacks underscores the vulnerability of bridges and interoperability platforms, necessitating urgent attention from the crypto community.

These 'points of failure' pose a significant challenge to the secure functioning of cross-chain transactions. While Justin Sun's intervention provided a safety net for affected users, the broader crypto industry must address these security concerns to facilitate the mass adoption of blockchain technology.

As the cryptographic landscape evolves, the need for sophisticated security measures becomes paramount to safeguard against cyber threats and prevent potential setbacks to the widespread adoption of blockchain applications. The hope is for the industry to progress towards a future characterized by robustness, impenetrability, and unwavering integrity.

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