CZ appoints Binance security team to track Huobi HTX stolen funds

September 26, 2023 Coin Telegraph

Binance

To minimize the damage, HTX proactively offered 5% of the drained funds as a “white-hat bonus,” which would amount to nearly $400,000.

Hours after the crypto exchange HTX (rebranded from Huobi) reported a hack that resulted in a loss of $8 million, Changpeng ‘CZ’ Zhao offered the help of the Binance security team in investigating the attack.

Timely intervention is key to tracking down and retrieving stolen cryptocurrencies as hackers attempt to hide their tracks using mixers or converting the loot to privacy tokens. On Sept. 24, blockchain analytics platform Cyvers identified a hack that managed to drain 5,000 Ether (ETH) from one of HTX’s hot wallets.

Red CodeYesterday, our ML-powered system detected a suspicious transaction involving @HuobiGlobal and @HTX_Global.
Despite our attempts to reach out, we received no response. An EOA received 5K $ETH $7.9M from @HuobiGlobal's hot wallet.

This morning, we spotted… pic.twitter.com/3oqHhAVi8P
— Cyvers Alerts (@CyversAlerts) September 25, 2023

To minimize the damage, HTX proactively offered 5% of the drained funds as a “white-hat bonus,” which would amount to nearly $400,000. However, the hacker has been provided with seven days to comply. HTX communicated the offer in Mandarin (Chinese) as shown in the screenshot below.

*HTX offering hacker immunity for returning 95% of the stolen funds. Source: etherscan.io*

On a lighter note, CZ joked about the resemblance of the newly rebranded HTX with Sam Bankman-Fried’s infamous crypto exchange FTX. However, the loss of funds in both exchange are incomparable — given that HTX was hacked and FTX was an alleged scam.

Responding to a tweet from Tron founder Justin Sun, who also serves as an advisor for HTX, CZ appointed Binance’s security team to help track the stolen funds. Additionally, Sun confirmed that HTX will cover all losses for its users. He added:

“$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' revenue for the HTX platform.”

HTX also implemented real-time monitoring mechanisms to prevent such losses. While Sun denies owning a major stake on HTX, he committed to conducting several live streams — in English and Chinese — to discuss exchange security.

Binance did not immediately respond to Cointelegraph’s request for comment about the ongoing HTX hack investigations.

Just a day before the HTX hack, Decentralized peer-to-peer network Mixin Network lost nearly $200 million in a hack involving the compromise of the database of a third-party cloud service provider.

[Announcement] In the early morning of September 23, 2023 Hong Kong time, the database of Mixin Network's cloud service provider was attacked by hackers, resulting in the loss of some assets on the mainnet. We have contacted Google and blockchain security company @SlowMist_Team…
— Mixin Kernel (@MixinKernel) September 25, 2023

An independent investigation from Web3 SaaS analytics platform 0xScope revealed the hacker's historical relationship with Mixin Network. In 2022, the address 0x1795 — which has been linked to the hacker — received 5 ETH from Mixin, and was deposited into Binance later.

Deposits and withdrawals on Mixin Network will recommence “once the vulnerabilities are confirmed and fixed.” The plans to recover the lost assets for users were not announced immediately.

Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.

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Huobi Global hacked for $7.9M: Report

September 25, 2023 Coin Telegraph

Coin Telegraph

HTX crypto exchange has been hacked, but it claims to know the identity of the attacker.

Huobi Global’s HTX crypto exchange was hacked on Sept. 24, according to a report from blockchain analytics platform Cyvers. A total of $7.9 million of crypto has been drained in the attack.

A known Huobi hot wallet posted a message to the attacker in Chinese. According to the message, the exchange knows the identity of the attacker and has offered to let them keep 5% of the drained funds as a “white-hat bonus,” but only if the attacker returns the remaining 95%.

Red CodeYesterday, our ML-powered system detected a suspicious transaction involving @HuobiGlobal and @HTX_Global.
Despite our attempts to reach out, we received no response. An EOA received 5K $ETH $7.9M from @HuobiGlobal's hot wallet.

This morning, we spotted… pic.twitter.com/3oqHhAVi8P
— Cyvers Alerts (@CyversAlerts) September 25, 2023

On Sept. 24 at 10:00 am UTC, the suspected Huobi hot wallet 0x2Abc22eb9A09EbBE7b41737CCde147F586EfeB6A sent 4,999 Ether (ETH), worth approximately $7.9 million, to an address which had no previous history. The following morning, a separate wallet belonging to Huobi sent a message to the attacker in Chinese. It stated (according to a Google translation):

We have confirmed your true identity. Please return funds to 0x18709E89BD403F470088aBDAcEbE86CC60dda12e. We will provide you with a 5% white hat bonus. This offer is valid for 7 days and ends on October 2, 2023. If you do not return the funds by the deadline, we will request judicial intervention.

Cyvers reported the attack on Sept. 25. The wallet that sent the message is identified as a Huobi hot wallet by blockchain analytics platform Arkham Intelligence. According to Cyvers, the wallet that sent the message is listed on a Huobi support page as belonging to the exchange.

This is a developing story, and further information will be added as it becomes available.

Huobi’s new name HTX raises community eyebrows

September 13, 2023 Coin Telegraph

Coin Telegraph

Huobi’s new name HTX stands for exchange, the blockchain project Tron and the company’s 10th anniversary.

Cryptocurrency exchange Huobi is celebrating its 10th anniversary with a controversial marketing move — the firm is rebranding from “Huobi” to “HTX,” echoing the name of the bankrupt exchange FTX.

Huobi officially announced its rebranding on Sept. 13, renaming the company to the new global brand, HTX. The new naming stands for the first letters of Huobi, Justin Sun’s blockchain project Tron and “X,” which symbolizes the exchange.

Another interpretation of the HTX name may also include “HT,” which stands for Huobi’s native token Huobi (HT). X may be interpreted as the Roman numeral for 10, which pays tributes to the company’s 10th anniversary. The new slogan of the firm is: “HTX, Just Trade It.”

Before officially announcing the news, Huobi renamed its social media accounts to reflect the new name. Huobi’s X account (formerly Twitter) is now named HTX_Global, while its official Telegram group is named HTX Global Official. Huobi’s domain still reflects the original Huobi name at the time of writing.

The new name of Huobi has quickly triggered some attention on social media. Many have questioned whether the new name has anything to do with FTX, the now-defunct exchange whose founder Sam Bankman-Fried is now facing a total of 13 charges relating to fraud.

“What's up with Huobi becoming HTX? I think it's giving me FTX vibes,” one cryptocurrency observer wrote on X.

“Is this supposed to be a joke? FTX to HTX? That's the first thing everyone will think,” another X user argued, expressing confusion why a brand would have taken such a name after FTX’s collapse in 2022.

*Community feedback to Huobi's new name HTX. Source: X*

Huobi is not the first company to borrow a part of its name from the troubled FTX though. In January 2023, the founders of the collapsed cryptocurrency hedge fund, Three Arrows Capital, or 3AC, announced a plan to raise $25 million for a proposed crypto exchange called GTX. Per their pitch deck, “because G comes after F,” pun intended with the bankrupt crypto exchange FTX.

Some cryptocurrency observers also argued that Huobi was renamed to HTX “after getting into legal trouble.” It appears to be unclear what legal troubles were implied as the exchange has been denying any issues recently. Huobi specifically denied reports suggesting that the firm was close to insolvency and also had some of its senior executives arrested by Chinese police in early August.

Previously, Huobi Global was also ordered to close its operations in Malaysia following an enforcement action from the country’s securities regulator in May 2023.

Huobi did not immediately respond to Cointelegraph’s request to comment.

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Binance drops majority of USD Coin reserves — Latest USDC news

August 9, 2023 Coin Telegraph

Binance

This week’s episode of The Market Report explores the reasons why Binance let go of a majority of its USDC reserves and what it replaced them with.

In the most recent episode of The Market Report, analyst and writer Marcel Pechman delves into the topic of crypto exchange Binance’s proof-of-reserves. This report reveals a significant decline in USD Coin (USDC) balances, plummeting from $3.4 billion on March 1 to a mere $23.9 million by May 1.

According to insights from on-chain analyst Aleksandar Djakovic, this decline signifies that Binance utilized the $3.4 billion to procure 100,000 Bitcoin (BTC) and 550,000 Ether (ETH) during that period, totaling approximately $3.5 billion. The central question, as posed by Pechman, revolves around whether this investment was initiated by Binance users, thereby distancing Binance CEO Changpeng Zhao and the company from direct involvement.

Pechman disagrees with this conjecture, although he does acknowledge the possibility of the exchange accessing a portion of its USDC reserved for margin or derivatives trades. Nevertheless, he finds the notion of depleting the entire balance without client awareness or impacting the exchange’s day-to-day functions implausible.

Transitioning to the next segment of the show, Pechman delves into PayPal’s imminent launch of a stablecoin, announced on Aug. 7. This stablecoin, issued by Paxos Trust and built on the Ethereum blockchain, bears striking similarities to USDC and Paxos USD (USDP). Yet, Pechman highlights a distinguishing factor in the integration of the stablecoin with PayPal and Venmo.

Ultimately, Pechman concludes that there is no discernible benefit for end users in adopting this new stablecoin. Other stablecoins, he points out, offer both yield and a more extensive presence in the decentralized applications market.

Lastly, Pechman addresses the circulating rumors that Huobi executives within the cryptocurrency realm are facing arrest by Chinese law enforcement. He also raises questions about Tron founder Justin Sun and the peculiar drawdown of Tether (USDT) reserves from Huobi.

For further insights into these matters, tune in to the latest episode of The Market Report, an exclusive show available on the newly launched Cointelegraph Markets & Research YouTube channel.

Huobi’s TVL drops to $2.5B amid rumors of insolvency, investigations in China

August 6, 2023 Coin Telegraph

China

The exchange faces ongoing rumors about its stablecoins reserves and an alleged investigation by Chinese authorities.

Cryptocurrency exchange Huobi has seen outflows worth $64 million between Aug. 5-6, amidst ongoing rumors about its solvency and that Chinese authorities were investigating its executives. Outflows over the weekend resulted in the exchange's total value locked (TVL) falling to $2.5 billion at the time of writing, down from $3.09 on July 6.

Rumors that the exchange's leadership had been arrested in China first surfaced on Aug. 4, as part of an alleged investigation about the exchange's dealings with gambling platforms. Speaking to Cointelegraph, a Huobi spokesperson labeled the claims as fake news. Rumors surface as authorities are reportedly tightening up control over cryptocurrency exchanges in mainland China.

Cointelegraph has learned that at least one C-level executive has left Huobi over the past few weeks, although it's unclear whether the departure is connected to investigations in China. On social media platform X (formerly Twitter), Huobi's head of social media said the rumors are untrue and that the exchange is "currently doing well".

The source has been verified as a senior executive at Tron who has first hand knowledge of the investigation and has been at Tron for many years.

Whether you’ve been informed or not, your colleagues are currently under criminal investigation.
— Adam Cochran (adamscochran.eth) (@adamscochran) August 6, 2023

The crypto exchange allegedly faces solvency issues as well. Fintech executive and angel investor Adam Cochran noted in a series of posts that the firm could be insolvent due to inconsistencies in its Tether (USDT) holdings.

Supported by on-chain data available on DeFiLlama, Cochran pointed out that across USDT and USD Coin (USDC) combined, Huobi held less than $90 million of assets on Aug 5. The exchange's latest 'Merkle Tree Audit', however, lists that "Huobi users have $630M in USDT held and a wallet balance of $631M USDT," reads the thread. According to Cochran, "Huobi is deeply insolvent."

According to DefiLlama data on Aug. 6, Huobi wallets held only $72 million in USDT and USDC combined.

*Huobi's reserves of USDT, USDC on Aug. 6. Source: DefiLlama.*

Huobi did not immediately respond to Cointelegraph's request to clarify rumors of insolvency and discrepancies between on-chain data and its audit report.

Huobi faces challenges in other jurisdictions as well. An enforcement action by the Malaysian securities regulator forced the exchange to close its operations in the country in May.

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Will $30K be a new springboard for Bitcoin bulls?

June 27, 2023 Coin Telegraph

Will K be a new springboard for Bitcoin bulls?

Binance

Bitcoin margin and futures markets display strength as institutional appetite surges after multiple spot ETF requests.

After a failed rally above $31,000 on June 23, Bitcoin (BTC) has sustained the $30,300 resistance for the past three days. Curiously, this happened while gold reached its lowest level in three months, trading at $1,910 on June 22, down from a $2,050 peak in early May.

Investors now question how solid Bitcoin’s $30,000 support is. So analyzing what caused the recent price rally is essential to understanding how traders are positioned on BTC margin and futures markets.

Why did BTC price break above $30,000?

Some analysts attribute Bitcoin’s recent 21.5% gains in 11 days to BlackRock’s spot Bitcoin exchange-traded fund (ETF) filing. But other events might have fueled the cryptocurrency gains. For instance, on June 26, HSBC Bank in Hong Kong reportedly introduced its first local cryptocurrency services using three listed crypto ETFs.

Moreover, the ProShares Bitcoin Strategy ETF, a Bitcoin futures fund, experienced its largest weekly inflow in a year at $65 million, with its assets topping $1 billion. It was the first BTC-linked ETF in the United States and is one of the most popular among institutional investors.

But, more importantly, the U.S. crypto regulatory environment may be improving after a period marked by enforcement actions from the Securities and Exchange Commission (SEC) aimed at exchanges supposedly operating as unregistered securities brokers.

On June 25, Federal Reserve governor Michelle Bowman said that financial institutions had been left in a “supervisory void” in terms of emerging technologies, including digital assets. Bowman added that policymakers have been relying on “general but non-binding statements,“ leaving substantial uncertainty and imposing new business requirements after significant investments have been made.

In that sense, a draft bill in the U.S. House of Representatives aims to prohibit the SEC from denying digital asset trading platforms registration as a regulated alternative trading system. Published on June 2, the proposed legislation would allow such firms to offer “digital commodities and payment stablecoins.“

Bitcoin margin, futures suggest bullishness

Now let’s look at Bitcoin derivatives metrics to better understand how professional traders are positioned amid improved regulatory perspectives and a sizable institutional inflow.

Margin markets provide insight into how professional traders are positioned because they allow investors to borrow cryptocurrency to leverage their positions.

OKX, for instance, provides a margin-lending indicator based on the stablecoin/BTC ratio. Traders can increase their exposure by borrowing stablecoins to buy Bitcoin. On the other hand, Bitcoin borrowers can only bet on the decline of a cryptocurrency’s price.

*OKX stablecoin/BTC margin-lending ratio. Source: OKX*

The above chart shows that OKX traders’ margin-lending ratio bottomed at 17 on June 20 but has improved over the past four days. The movement indicates a prevalence of margin longs as the present 24x ratio favors bullish stablecoin lending.

Still, investors should analyze the Bitcoin futures long-to-short metric, which excludes externalities that might have solely impacted the margin markets.

*Exchanges’ top traders Bitcoin long-to-short ratio. Source: CoinGlass*

There are occasional methodological discrepancies between exchanges, so readers should monitor changes instead of absolute figures.

Top traders at Huobi vastly increased their longs between June 22 and June 24 as Bitcoin price broke above the $30,000 resistance.

On the other hand, OXK’s top traders initially increased their shorts on June 22 and June 23, but subsequently reverted their positions by adding bullish bets.

Lastly, the top traders at Binance started adding longs on June 21 and have kept increasing bullish positions until June 23.

Bitcoin’s $30,000 support showing strength

Overall, Bitcoin bulls have added leverage-long positions using margin and futures markets backed by the positive momentum from multiple spot Bitcoin ETF requests, heavy institutional inflow and a more rational approach from U.S. lawmakers.

The SEC’s regulation-by-enforcement approach is not backed by some U.S. Federal Reserve governors and has faced some serious backlash in the U.S. House of Representatives. For example, Representative Warren Davidson has introduced the SEC Stabilization Act, citing “ongoing abuse of power” and demanding the removal of Gary Gensler as chair of the SEC.

Given the favorable scenario toward cryptocurrencies, Bitcoin bulls should now have the upper hand to sustain the $30,000 BTC price support level in the coming weeks.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Crypto exchange Huobi returns to profitability in Q1 after restructuring

April 10, 2023 Coin Telegraph

Coin Telegraph

After cutting employees and benefits, the cryptocurrency exchange reportedly made a $30 million profit during the first quarter of 2023.

According to an Apr. 10 post by Justin Sun, the de facto owner of cryptocurrency exchange Huobi Global, the firm recognized $150 million in revenue during Q1 2023 compared to $120 million in expenditures, resulting in a net income of $30 million. Sun says that "a large number of measures were taken to reduce costs and increase efficiency" during the quarter. For Q2 2023, he projects the exchange will bring $187 million in revenue and $76 million in expenses, with a net income of $110 million.

Huobi was one of the largest cryptocurrency exchanges by volume until the off-boarding of its Mainland Chinese users began in 2021. Its market share subsequently fell from 19% in 2020 to an estimated 2.2% in Q4 2022. Sun, who claims to be an "adviser" at Huobi Global, reportedly purchased 100% of the exchange's stake from co-founders in November 2022 through his entity About Capital.

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Earlier this year, Huobi Global reportedly laid off 20% of its employees and slashed employment benefits as part of restructuring efforts. A major incident occurred on Mar. 10 when the exchange's native token, Huobi Token (HT), suffered a flash crash leading to a more than 90% drop in its price within hours.

The token has since recovered most of its losses; however, one major user, who goes by the Twitter handle Lantian666, claims to have lost $4 million due to margin liquidations on HT during the flash crash. Lantian666 says they have yet to receive full compensation from Huobi as a result of the incident despite claims from Sun that all users impacted by the crash will be compensated.

Dear colleagues in the crypto circle, I am the owner of the account that was forcefully liquidated for 4 million dollars on March 10th at 5:00 am by the Huobi platform's HT pin liquidation. I will continue to share all the details and what Huobi did at that time #ShameonHuobi pic.twitter.com/HzDf7xE2Gv
— nnn (@lantian6666) March 26, 2023

Huobi partners with Gala Games for L1 and Web3 development

March 31, 2023 Coin Telegraph

Coin Telegraph

Huobi Global has joined hands with Gala Games, a blockchain-based play-to-earn gaming platform, to work together on the investment and listing of Web3 projects.

Huobi Global, a cryptocurrency exchange, has declared a strategic partnership with Gala Games, a blockchain-based play-to-earn gaming platform.

In an official blog post on March 31, Huobi announced a partnership with Gala Games to develop the Web3 ecosystem. The two companies will collaborate to invest in and list projects within the Gala ecosystem.

Gala Games enables developers to create play-to-earn crypto and nonfungible token (NFT) games, which allow players to buy and sell in-game items. Once purchased, these in-game items cannot be modified or deleted by developers without the players’ consent.

Huobi’s collaboration with Gala Games is expected to enhance the former’s Web3 objectives, allowing it to integrate with the Gala layer-1 blockchain to improve the underlying on-chain technology. Jason Brink, who serves as the president of blockchain at Gala Games, has stated that integrating its layer-1 blockchain with major exchanges like Huobi is of utmost importance for achieving the desired level of mass adoption.

Great News!#Huobi is happy to announce a strategic partnership with #Gala Games @GoGalaGames in ecosystem development.

Together, we will cooperate in the investment and listing of high-quality projects, including Layer1 integration, cobranding & community development. pic.twitter.com/LTqy8pXkF3
— Huobi (@HuobiGlobal) March 31, 2023

Huobi also took to Twitter to announce the partnership with Gala Games, with the community expressing support for the partnership due to the advantages of the layer-1 blockchain.

At present, Huobi Global is pursuing a license in Hong Kong in light of new regulatory measures being considered by the Chinese special administrative region that would enable the platform to cater to retail clients.

Additionally, Huobi has announced its plans to expand its services in other regions by launching a Visa-backed crypto-to-fiat debit card. This card will be available to Huobi customers residing in the European Economic Area, and is expected to launch in the second quarter of 2023.

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