HTX Experiences $248 Million in Net Outflow After Security Breach
Since resuming operations after a major security breach, Justin Sun-linked crypto exchange HTX has seen a net outflow of $248 million. The breach resulted in the loss of $30 million worth of crypto tokens and prompted HTX to temporarily halt withdrawals and deposits. Despite the exchange’s assurances of a thorough investigation and compensation for the losses, concerns persist among users.
Justin Sun-Linked Platforms Exploited for $200 Million
Justin Sun, associated with HTX, also has ties to the Poloniex exchange and the HECO Bridge, both of which experienced hacks resulting in the theft of approximately $200 million. Sun has faced scrutiny with allegations of market manipulation for the TRX token from the Tron blockchain. The Securities and Exchange Commission filed a lawsuit against Sun and his firms in March.
HTX’s Reserves and Successful Recovery
As of December 8, HTX’s reserves reveal that about 33% is Bitcoin, while TRX represents around 32%. HT accounts for approximately 14%, and a Sun-backed token called stUSDT makes up 12% of the reserves. HTX successfully recovered $8 million stolen in September but still lacks control over the $30 million taken in November.
Growing Sensitivity to Security-Related Issues
The recent outflow from HTX highlights investors’ growing sensitivity to security-related issues in the aftermath of high-profile exchange collapses. This reflects concerns following last year’s collapse of the FTX platform.
Hot Take: HTX Struggles to Regain Trust After Breach
Despite assurances and compensation efforts, HTX continues to face challenges in regaining trust and retaining users. The substantial outflow of $248 million since resuming operations after the security breach indicates lingering concerns among investors. The association with Justin Sun, who has faced scrutiny and legal action, further adds to the skepticism surrounding HTX. To rebuild confidence, the exchange will need to prioritize and strengthen its security measures, demonstrate transparency, and take proactive steps to prevent future breaches. Only through these actions can HTX hope to restore its reputation and attract new users in the competitive crypto market.
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