November 13, 2023

Potential Security Breach at Poloniex, Justin Sun's Crypto Exchange, with Suspected Losses Exceeding $100 Million

Poloniex, a centralized cryptocurrency exchange, appears to have fallen victim to a significant security breach affecting more than $100 million in digital assets.

Centralized cryptocurrency exchange Poloniex seems to have experienced a security breach involving one of its wallets, identified as Poloniex 4 on Etherscan.

Unusual outflows from the purported hot wallet strongly suggest that a substantial amount of its funds was impacted, although the exchange has not officially confirmed the exact figure.

Preliminary analysis of the addresses receiving the outflows indicates that the breach resulted in the loss of over $100 million in cryptocurrency assets, as reported by analyst firms PeckShield and Arkham Intelligence. The exchange announced on its customer support X account:

"Our wallet has been disabled for maintenance. We will update this thread once the wallet has been re-enabled."

Operating as a centralized exchange since 2014, Poloniex was acquired by Tron founder Justin Sun in 2019.

In response to the incident, Sun confirmed that Poloniex is currently conducting an investigation and pledged to reimburse all affected user funds.

"We are currently investigating the Poloniex hack incident. Poloniex maintains a healthy financial position and will fully reimburse the affected funds," stated Sun.

Sun also extended a 5% whitehat bounty to the attacker, contingent on a complete fund return, with a seven-day deadline before initiating legal proceedings with law enforcement.

Losses are within manageable limits

Sun reassured later in the day:

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