In response to pNetwork’s external statement on the GALA incident today, Huobi Global’s statement is as follows:

Huobi believes that pNetwork’s behavior is not a so-called white hat action, but a malicious stealing attack by hackers for the purpose of profit.

The three main reasons are as follows:

1. In the prior communication with the exchange, the pNetwork team never stated that they would attack GALA’s token vulnerability by increasing the issuance of Tokens, completely concealing its attack behavior, and exploiting the contract vulnerability within 50 minutes of contacting the exchange An additional 55.6 billion tokens were issued for the attack, which did not give the exchange any reaction time at all.

After investigation, it was found that the vulnerability was caused by pNetwork engineers accidentally leaving a key in the contract 67 days ago, which led to hidden dangers for subsequent tragedies.

2. There is no evidence that someone will use this vulnerability to attack, but there is no silver 300 taels here, and the person who profited from this vulnerability attack is pNetwork itself. It is obvious that other safe solutions can be chosen, but when the vulnerability has existed for 67 days, the pNetwork team eagerly chose to actively attack the vulnerability within 50 minutes, and increased the issuance of 55.6 billion tokens to get huge profits.

If it is a responsible project team, it can ask the exchange to switch to the new currency, immediately suspend the top-up and withdrawal of the old contract, give all participants at least one day or more sufficient reaction time, and ask PancakeSwap users to withdraw liquidity The pool can be used, and there is no need to actively use the vulnerability to increase the issuance attack to make a profit. It is not justified and necessary to use the vulnerability to increase the issuance.

During the attack period, pNetwork earned more than 4.5 million US dollars. At the same time, there were multiple associated addresses. At the same time, the premeditated operation profited more than millions of US dollars, and the cumulative profit exceeded 10 million US dollars. The real purpose of the attack is to make a profit.

3. pNetwork argues that the increased issuance of up to 55.6 billion Tokens is only for the purpose of extracting a liquidity pool worth about 400,000 US dollars.

This reason is groundless. The pNetwork and GALA teams are very aware of the potentially devastating impact of this operation. Why? They insisted on issuing an additional 55.6 billion GALA to smash the market without giving the third party any reaction time, and the 400,000 US dollars in the liquidity pool also belonged to the user’s funds, and pNetwork has no right to arbitrage and possess it.

Make a profit and use the “white hat attack” as a guise to conduct hacking attacks to avoid legal sanctions!

In addition, Huobi has sorted out the key time nodes related to Huobi Global in this incident as follows:

11-04 03:23AM (GMT+8) pNetwork used its one-way communication channel to contact Huobi Global, but did not mention that pNetwork was preparing to attack Vulnerability, not to mention the fact that an additional 55.6 billion GALA tokens will be issued in the market within 50 minutes for a huge sell-off, and the serious consequences that will cause extremely heavy losses to innocent users and exchanges.

11-04 03:48AM (GMT+ 8) The GALA team confirmed that Binance closed the BEP20 GALA add-on and withdrawal, but did not confirm with Huobi Global’s window team about closing the add-on and withdrawal.

11-04 04:13AM (GMT+8) pNetwork added for the first time Issue 27,814,200,000 pGALA.

11-04 04:27AM (GMT+8) pNetwork issued 27,814,200,000 pGALA for the second time, with a total issue of 55.6 billion.

11-04 04:28AM (GMT+8) pNetwork issued an official announcement, falsely claiming that “its cross-chain bridge configuration is wrong”, which led to the minting of more than 1 billion US dollars of pGALA tokens out of thin air on the BNB Chain, trying to cover up as a hacker, And the fact that 55.6 billion GALA tokens were issued out of thin air by exploiting the loopholes, the continuous smashing of tens of billions of profits has obviously constituted a crime.

Based on the above points, Huobi has reason to believe that:

pNetwork’s behavior is not a so-called white hat attack, but a hacker attack with malicious profit as the ultimate goal. This is a hacking attack planned and premeditated by the pNetwork team, and the white hat attack is just an illegal excuse sought by the pNetwork team to avoid legal sanctions.

In the process of handling this incident, neither the GALA nor the pNetwork team confirmed the security enforceability with Huobi Global through proper communication procedures.

They made their own claims and maliciously used the management authority to increase the issuance of more than 55.6 billion GALA tokens on the BNB Chain and took the lead.

The GALA and pNetwork teams could have chosen other safer ways to fix the vulnerability to avoid the tragedy, but they chose to cover up the truth and executed a massive 55.6 billion GALA increase issuance attack within 50 minutes, which was completely malicious.

This is tantamount to a terrorist attack on innocent users and trading platforms, and the entire industry has suffered a huge blow and implicated.

Prior to this, Huobi Global only represented the victimized users and had long-term communication with the pNetwork team to seek reasonable compensation for the victimized users, but in the end, there was no positive response to the follow-up compensation.

In view of the fact that pNetwork’s unconfirmed unilateral statement about the GALA incident is seriously inconsistent with the facts, it has caused significant damage to the security of Huobi Global’s users’ assets, and the project’s attitude of completely evading its own responsibility, as the world’s leading virtual asset trading platform, protecting the interests of users and guarding the safety of users’ assets are the most important things Huobi has attached to since its establishment nine years ago.

In order to fulfill its commitment to users, Huobi Global will take the lead in uniting and representing all the victimized users on the platform, working with global partners to take all legal means, including class actions and filing cases, to investigate and criminally prosecute the main managers of pNetwork for the full responsibility for this incident.

Huobi calls on all attackers who profit from the vulnerability to return the profits gained from the attack.

Huobi Global is willing to give back through a $1 million bounty program and will no longer pursue its relevant legal responsibilities.

Huobi Global will stand side by side with every user on the platform until the reasonable demands of users are fully responded.