Huobi Exchange Loses $7.9 Million in Cyberattack
Global cryptocurrency exchange Huobi has fallen victim to a cyberattack, resulting in the theft of 5,000 ETH valued at approximately $7.9 million. The attack was first reported by CyversAlerts, a reputable crypto security company. According to the firm, the attack was successful due to a compromise in one of Huobi’s hot wallets – easily accessible cryptocurrency wallets connected to the internet.
Huobi Global investor Justin Sun confirmed the attack and revealed that the exchange has identified the wallet address used by the hackers as well as their identity. In an interesting move, Huobi sent a transaction to the hacker’s wallet address with a message, informing them of their knowledge and demanding the return of the stolen funds within a specific timeframe.
Huobi’s Unique Proposal
In an effort to resolve the situation amicably, Huobi has offered to reward the cybercriminals with a 5% bonus for returning the stolen funds, amounting to about $395K. Additionally, they plan to hire the hacker as a security consultant, as confirmed by Sun on Twitter.
However, if the stolen funds are not returned within the given timeline, Huobi will involve law enforcement in pursuing legal action against the criminals.
Possible Connection to Lazarus Group
Crypto exchanges have been attractive targets for cyberattacks due to their weak security architecture and large holdings of cryptocurrencies. According to a report by Crystal Blockchain, approximately $16.7 billion in cryptocurrencies has been stolen between January 2011 and February 2023.
The Lazarus Group, an infamous cyberattack organization associated with North Korea, has been linked to several hacks in the crypto landscape. Recently, CertiK announced that the group was responsible for a $41 million theft from Stake online casino. They also revealed that the same group had swapped and bridged 520,000 MATIC tokens worth over $266,000 to the Avalanche blockchain.
While there is currently no evidence connecting the Huobi exchange attack to the Lazarus Group, further investigation will provide more clarity in the coming days.
Hot Take: Huobi’s Unconventional Approach to Cyberattacks
The recent cyberattack on Huobi highlights the ongoing security risks faced by cryptocurrency exchanges. Huobi’s response, offering a reward and even potential employment to the hackers, is an unconventional approach to resolving such incidents.
This move could be seen as an attempt by Huobi to negotiate with the criminals and potentially recover some or all of the stolen funds without involving law enforcement. It remains to be seen whether this unique strategy will be successful or if it sets a precedent for future cyberattacks on crypto exchanges.
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