About Kucoin’s Hack
On October 3th, a hacker stole ~$150MM in assets from Kucoin’s hot wallets. Part of these assets were Flixx that the hacker dumped in the market in a matter of hours, sinking the price of the token. We have decided to share some lines with our community to better understand the responsibilities and the future of the token and the project.
Buenos Aires, October 5th 2020
Long story short, we listed our token Flixx in Kucoin back in December 2017. Kucoin was a small exchange then, and our contact was fluid. After a year, the exchange grew from 8 people to 200 employees. Our new “listing manager” warned us about having low liquidity, and they marked our project as “ST”, which I don’t remember exactly the meaning of, but it was something like a special zone, or special treatment for observed projects — that wasn’t the best tool for improving liquidity on their market... — . They asked for a minimum 5BTC daily volume to keep the project listed. We decided not to wash trade — it was always a path we decided not to take— , and we changed our market-making strategy successfully to reach ~90K USD daily trading volume (about 8BTC in August 2019) However, our listing manager decided to delist the token on August 5th. They kept withdrawal active until November 2019. Until the last days of September 2020, 6,2MM tokens were still deposited on Kucoin’s wallets.
On October 3th, we’ge got reached out by Kucoin’s team to inform their exchange was hacked. The hacker took away ~$150MM in assets (mostly ETH and ERC20 tokens, ) and sent a part of all the stolen funds, including all the Flixx, to this address:
Being aware of the situation, we stopped market making on Liquid and removed 90% of liquidity from DEXs, to discourage any selling attempt . Two days later, the hacker moved his Flixx to:
The hacker immediately sent, in batches, all his funds to 1inch.exchange (a dex aggregator) managing to swap all his tokens for 50ETH. Part of the funds came from our liquidity pools, part of the funds came from users buying Flixx at a low price on Bancor, Uniswap, Livecoin, and Liquid. By the end of the day, Flixxo liquidity pools converted 5,5MM Flixx to ETH. Hacker sent his fresh ETH to the following address:
Trading against a very low liquidity, price of Flixx dumped to its all-time low of $0.001440 (85% down)
Price of Flixx is slowly recovering, even though Coin Market Cap is not accurately reflecting it. Due to the nature of the huge movements in the market their algorithm does not to take accountancy of the prices where they see a big slippage on a certain exchange.
Using the fiat money we’ve earned through advertising in the platform, and following our vision and our plan (token buyback), Flixx price has already recovered 4x from its bottom. And we will keep exchanging every single dollar we receive from ads, till a full price recovery.
Furthermore, we are developing new market-making strategies and building up new DeFi tools, both on the Ethereum and Bitcoin networks, in partnership with IOV Labs (RSK) and his brand new DeFi on Bitcoin ecosystem.
We are confident on a quick price recovery that follows our new achievements on the product side. We are very grateful of our community and HODLERS, which showed their support, and we will keep growing our user base, improving our apps, ecosystem and working our fingers to the bone to make Flixxo thrive and show its potential in the short term.
As always, we are available to answer any further question on our Telegram chat!
Keeping the same enthusiasm as the first day, and looking forward to continue BUIDLING!
CEO of FLIXXO