- Huobi Global confirmed the return of ETH worth $8 million after a successful negotiation.
- This incident highlighted a growing expanse of firms negotiating with hackers instead of calling upon law enforcement.
Huobi Global’s cryptocurrency exchange successfully recovered $8 million in stolen Ethereum [ETH]. The recovery followed negotiations with the hacker, who ultimately agreed to return the stolen funds.
Justin Sun, a Huobi Global investor and HTX adviser, announced the news on Twitter, expressing satisfaction that the hacker made the “right choice” by accepting Huobi’s offer.
As part of the agreement, the hacker received a “white hat bonus” of 250 ETH for returning the funds, highlighting Huobi’s commitment to user asset security.
We have confirmed that the hacker has fully returned all funds, as promised, and we have also paid the hack a white hat bonus of 250 ETH. The hacker made the right choice. We would like to express our gratitude to everyone in the industry for their help!
— H.E. Justin Sun 孙宇晨 (@justinsuntron) October 7, 2023
The incident was initially disclosed on 25 September when Huobi reported that one of its hot wallets had been compromised, resulting in the theft of 5,000 ETH.
Despite the breach, Huobi assured its customers that the amount stolen was relatively small compared to its total assets, which were valued at $3 billion.
In a proactive move, Huobi offered a “white-hat reward” of 5% of the stolen ETH to incentivize the hacker to return the funds, with a warning that law enforcement would be involved if the offer was not accepted within a week.
Stolen funds recovered in high-stakes dubious deal
This recovery highlights a growing trend in the cryptocurrency industry, where firms often find themselves negotiating with hackers to retrieve stolen funds rather than solely relying on law enforcement.
In many cases, agreements are reached where a significant portion of the funds is returned, and a bounty is paid to the hacker as part of the resolution.
Cryptocurrency exchanges have been frequent targets for hackers, but the types of exchanges targeted have varied. A report by Immunefi in July 2023 revealed a 63% increase in blockchain hacks in the second quarter of the year compared to the same period in the previous year.
DeFi platforms were the primary targets, experiencing 79 incidents, resulting in $228 million in losses. In contrast, centralized exchanges (CEXes) like Huobi Global reported $37 million in losses across just two incidents during the same period.
