In the past week, Poloniex, a well known digital currency exchange, fell victim to a sophisticated hacking incident. In this article we will dive into the critical moments of the breach and will take a look at the swift actions taken by Poloniex in response to the crisis.
On November 10, 2023, a well-known crypto user tweeted about a significant event that occurred on Poloniex. He noticed that a wallet on Poloniex, containing over $67 million in assets, was being drained. Within just an hour, about $63 million in assets were drained, leaving $4 million worth of assets in the wallet. He further claimed that the TRX coin was surging. This could indicate that the hacker was deliberately pumping TRX to profit from massive buying.
After the news broke, Poloniex CEO Justin Sun posted about it on their Twitter page, including screenshots from their official handle.
Justin wrote about how Poloniex is exploring opportunities to collaborate with other exchanges to help recover the stolen assets. Shortly after, the CEO of Binance Exchange tweeted in response to Justin Sun’s tweet.
Read how you can keep your crypto safe: Unconventional Methods To Safeguard Your Crypto Investments Amid Rising Hacking Threats
Recovery Plan
Upon realizing they had been hacked, Poloniex revealed their recovery plan. Justin Sun continued with a tweet, stating that they are offering a 5% white hat bounty to the hacker. They added a wallet address in the tweet, where the hacker can return the stolen assets. Otherwise, Poloniex will engage law enforcement.
Arkham also responded by offering to help Poloniex recover the stolen asset. They created a bounty, funded in ARKM Coin, their platform’s traditional asset, for anyone who helps identify the person or organization behind the exploit. Below is the tweet.
Finally, Poloniex CEO Justin Sun tweeted an update from the team, stating that they have successfully identified and frozen a portion of the assets associated with the hacker’s addresses. At present, the losses were at manageable limits, and Poloniex’s operating revenue could cover those losses.
This means the hacker distributed the stolen assets to different wallet addresses, likely created by them. Poloniex was able to identify and freeze some assets from one of the wallet addresses associated with the hacker. They also claimed that their system was restored and that they could preserve relevant evidence. In the coming days, they said they would gradually resume withdrawals and deposits on Poloniex.
Final Thoughts
The Poloniex hack serves as a stark reminder of the ever-present vulnerabilities in the world of cryptocurrency. While the swift response and comprehensive recovery strategy of Poloniex demonstrate resilience and a commitment to security, the incident underscores the need for continuous vigilance and innovation in cyber defense mechanisms within the crypto industry.
This is just one out of many crypto exchange hacks that we have seen in the past years. We recommend you to not hold your cryptocurrencies on exchanges unless you plan to make a transaction in the near future.
