Key Highlights
- HTX says it has introduced multiple withdrawal addresses for hot-wallet funds and will rotate them periodically.
- Justin Sun said the changes are intended to reduce the impact of a security incident involving any single withdrawal address.
- The update follows reports of unsolicited USDT transfers from addresses labeled as HTX that triggered compliance concerns at other exchanges.
HTX has announced changes to its cryptocurrency withdrawal infrastructure following a series of reports involving small unsolicited transfers from addresses associated with the exchange and subsequent compliance restrictions at other platforms.
Justin Sun, an adviser and owner of the HTX exchange, outlined the changes in an X post on August 20. He said the exchange has moved to a multiple-address withdrawal system, with hot-wallet assets distributed across different addresses rather than concentrated in one wallet.
The announcement comes after recent reports raised questions about transfers from HTX-linked wallets and their effect on users whose addresses received small amounts of USDT without their request.
HTX introduces multiple withdrawal addresses
According to Sun, HTX has introduced multiple withdrawal addresses for hot-wallet funds and will rotate them periodically.
Sun said that once a new address becomes active, the previous address is decommissioned and is no longer controlled or used by HTX.
“Enabling a multi-withdrawal address system, with hot wallet assets stored in a decentralized manner, not putting all eggs in one basket,” Sun wrote.
The stated objective is to reduce the amount of funds exposed through any individual hot-wallet address.
Sun also claimed that potential losses from an extreme security incident involving one address would be limited to $1 million and covered by HTX’s insurance fund.
That is an assurance from HTX rather than an independently verified assessment of the exchange’s security or insurance coverage.
Update follows unsolicited USDT transfer reports
The infrastructure changes come shortly after reports of small USDT transfers from wallets labeled as belonging to HTX.
Earlier reports said 166 small USDT outflows were traced to an HTX hot wallet, with 15 receiving addresses subsequently linked to Kraken.
Some users reported that receiving unsolicited transfers from HTX-associated addresses resulted in compliance reviews or restrictions at other exchanges.
The transfers have been described as an address-poisoning or dusting-related incident, where small transactions are sent to addresses in an attempt to create confusion around transaction history or associate unrelated wallets with a particular source.
Importantly, the presence of an HTX-labeled address in a transaction does not by itself establish that HTX intentionally sent the funds.
HTX denies authorizing the transfers
HTX has rejected claims that it deliberately sent the disputed transfers.
In an earlier response, an HTX market representative said the exchange had discussed the matter internally and that the platform “absolutely did not engage in such behaviour.”
The exchange characterized the activity as either a misunderstanding or possible third-party interference and said it was examining the transactions.
The latest changes announced by Sun therefore come amid an unresolved dispute over the origin and purpose of the transfers.
Kraken freezes funds linked to the disputed activity
The issue has also affected users of other exchanges.
Recent reports said Kraken froze up to $4.2 million in funds connected to transactions that were suspected of being linked to the HTX-associated addresses.
The reported freezes were related to compliance concerns surrounding the provenance of funds rather than a finding that the affected users had themselves committed wrongdoing.
For users, the episode illustrates how relatively small blockchain transfers can create complications when receiving addresses interact with exchanges that use automated transaction monitoring and wallet-screening systems.
Binance and other exchanges have also restricted HTX
The latest security controversy is unfolding against a broader backdrop of regulatory and compliance pressure on HTX.
Early this month, Binance announced restrictions on transactions involving HTX and several other crypto platforms, with the measures tied to a wider sanctions-related compliance framework. Binance said transactions involving the affected platforms could be held for compliance review after the restrictions take effect.
Bitget also introduced restrictions involving HTX and other platforms as part of its own compliance measures, according to earlier reports.
These actions are separate from the recent address-poisoning reports, but together they have increased scrutiny around transactions involving HTX-linked addresses and the ability of users to move funds between exchanges.
Sun says address rotation will become routine
Sun said users should expect HTX withdrawal addresses to change periodically under the new system.
“Withdrawal addresses will change periodically, which is a normal security mechanism; please refer to the actual on-chain receipt for accuracy.”
The change means users who rely on saved withdrawal addresses may need to verify the destination address each time they transfer funds from HTX.
That could reduce the risk associated with long-lived hot-wallet addresses, but it also introduces an additional operational step for users.
Security changes amid compliance pressure
HTX’s latest security changes come as centralized exchanges face growing scrutiny over wallet activity, transaction monitoring, and compliance requirements.
The exchange says spreading hot-wallet funds across multiple addresses and regularly replacing them will reduce the risks linked to a single wallet. However, it remains unclear whether the new setup can prevent similar incidents or avoid compliance restrictions affecting users.
The move also highlights the growing importance of wallet attribution, as transactions linked to certain addresses can trigger additional checks on other platforms.
For now, HTX is formalizing a multi-address withdrawal system while continuing to face scrutiny over its wallet activity.
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