Ramazan Eles 
Chinese authorities have announced a major crackdown on a group of former employees from the once-dominant cryptocurrency exchange, Huobi. The individuals, identified as Zhang, Dong, Liu, and Zhang Yi, have been convicted of orchestrating a sophisticated crypto theft scheme.
According to a statement released by Ping An Xuhui, the suspects devised a malicious plan to steal user funds. They managed to infiltrate Huobi’s systems and implant a backdoor into the exchange’s wallet software. This backdoor allowed them to steal over 40,000 user mnemonic phrases and private keys, granting them access to a vast amount of cryptocurrency.
The theft occurred before Justin Sun acquired Huobi, making it one of the largest crypto thefts from a Chinese exchange. While the exact amount of cryptocurrency stolen has not been disclosed, the scale of the operation underscores the significant risks associated with cryptocurrency exchanges.
Investigators revealed that the plot was hatched in early March 2023. The perpetrators carefully planned their actions, inserting the malicious code into the wallet software to extract user data. After successfully obtaining the private keys, they deleted the server and database to cover their tracks. Their intention was to exploit the stolen funds at a later date.
Following an extensive investigation, Chinese authorities apprehended the suspects. In April 2024, Xuhui District People’s Court sentenced Liu, Zhang A, and Dong to three years in prison and fined them 30,000 yuan for illegally obtaining computer information system data.