XT Exchange Suspends Coin Withdrawals After PeckShield Reports $1.7M Hack

XT Exchange, trading over $3 billion worth of cryptocurrency daily, has suspended all coin withdrawals. In an update shared with users, the exchange claimed the suspension arose due to “wallet upgrade and maintenance.”

Key Notes

XT Exchange, trading over $3 billion daily in cryptocurrency, has suspended all coin withdrawals. In an update shared with users, the exchange claimed the suspension arose due to “wallet upgrade and maintenance.”

Hacker Swaps $1.7M Theft to Ethereum

However, about an hour earlier, prominent security firm PeckShield reported that XT.com seemed to have suffered a hack by malicious actors. According to PeckShield, the loss inflicted by the malicious attacker on the exchange was worth $1.7 million in cryptocurrency.

PeckShield reported that as soon as the hacker successfully stole the funds, he immediately swapped them for 461.58 ETH. The converted Ethereum now sits in a wallet address “0xB43f…8F83.”

In a post on X, XT Exchange acknowledged the incident, describing it as an “abnormal transfer of platform wallet assets”.

XT, however, reassured its users that this incident would not affect them. According to the exchange, its reserves have always stayed 1.5x greater than users’ assets. This remains one sure way that they guarantee maximum security.

XT also claimed they have a team of investigators working on the incident. While expressing continued commitment to protecting the assets of its users, it hinted at a move that would further strengthen security on the exchange.

XT says it will launch the Merkel Tree Asset Proof System by mid-December. This move is meant to increase users’ trust and build a more transparent ecosystem. Following this breach, the industry would focus on XT to see how it weathers the storm and how its security systems would respond.

XT Users’ Concerns and Industry Implications

XT crypto exchange registered in Seychelles in 2018, deals in centralized cryptocurrency and facilitates trading of over 1,000 digital currencies. The exchange joins the list of crypto exchanges in which malicious actors have successfully compromised their security architecture.

Despite the statement put out by XT on the incident and suspension of coin withdrawal, users appear restless. Some users’ reactions to the hack update could be interpreted as “dissatisfied.”

Nitin (@NG_Exhales) on X, while appreciating the update, insisted on getting more information. “That’s reassuring. Thanks for that. However, could you help us with the timeline, when will the withdrawals reopen?”

Another user suggested that if the recovery time lingers, it will create room for scale speculation. Many in the crypto space have already called for XT to disclose how the malicious actor fully compromised the exchange.

The XT incident emphasizes the incessant security challenges prevalent in the crypto sector. In addition to institutions being targeted, private individuals have also suffered massive losses of funds.

Coinspeaker recently reported a crypto trader who lost $36 million in a phishing attack. The malicious actors gained control after the trader signed a “permit” phishing signature that allowed access to their digital wallet.

Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.