Multi-Chain Exploit Costs Phemex $37 Million as Exchange Takes Emergency Action

The global crypto exchange Phemex has come under scrutiny following the detection of suspicious transactions involving its hot wallets.

Cyvers Alerts, a real-time security monitoring platform, revealed that suspicious addresses had moved over $29 million worth of digital assets from Phemex. Notably, this happened across multiple blockchains, including BNB Chain, Ethereum, Optimism, Polygon, Base, and Arbitrum. 

Subsequent investigations have confirmed additional breaches on Bitcoin and Tron blockchains, pushing the estimated total loss to approximately $37 million.

Cyvers Alerts reported that attackers quickly began converting stolen funds to Ethereum, making it difficult to trace the assets. Typically, such actions aim to launder funds through mixing services.

In their analysis, Cyvers identified 125 suspicious transactions spread across 11 blockchains. Some tokens, including stablecoins, were already swapped to evade freezing measures by security teams.

Phemex Reacts

Meanwhile, Phemex announced an immediate suspension of withdrawal services to conduct a comprehensive security inspection. The exchange also confirmed that trading services remain operational, and its cold wallets are unaffected.

According to Phemex’s CEO, the company is working on an emergency plan to enhance wallet security and implement a compensation scheme for affected users.

Ongoing Threats to Exchanges

This incident at Phemex follows a rise in exchange-targeted hacking activities over recent months. In September 2024, Singapore-based exchange BingX suffered a breach, losing over $43 million.

Blockchain security firm PeckShield reported large outflows from BingX’s hot wallets. Notably, this prompted the exchange to transfer assets to cold wallets as part of its emergency response.

Similarly, Indonesian exchange Indodax lost $22 million in a security compromise four months ago. Blockchain analysts tied the attack to North Korea’s Lazarus Group, which exploited vulnerabilities to access the exchange’s wallets. The stolen assets included Bitcoin, Ethereum, Tron, and USDT.

Further, India’s largest crypto exchange, WazirX, suffered a major breach in July 2024, with hackers stealing over 5 trillion Shiba Inu (SHIB) and other assets. Blockchain analytics platform Lookonchain revealed that crypto worth $230 million was transferred to an unidentified address.