Incident Overview
On January 23, 2025, Phemex crypto exchange detected nearly $30 million in suspicious outflows from its hot wallets, prompting the exchange to halt withdrawals and launch a security inspection. Subsequent investigations revealed additional breaches across Bitcoin and Tron networks, bringing the estimated total loss to $37 million.
The exploit targeted Phemex’s hot wallets across multiple blockchains, including Ethereum, BNB Chain, Polygon, Arbitrum, Base, and Optimism. Blockchain security firm Cyvers identified 125 suspicious transactions involving digital assets such as stablecoins and tokens, which were swiftly swapped to Ethereum to bypass freezing measures. These funds are suspected to have been laundered through mixing services like Tornado Cash.
Despite the breach, Phemex confirmed that its cold wallets remain secure. In response, the exchange suspended withdrawals, kept trading services operational, and announced plans to bolster wallet security while devising a compensation strategy for affected users.
Incident Report
Protocol Information
Market Context at Time of Hack
What the Attacker Needed to Succeed
Understanding the prerequisites for this type of attack helps auditors identify protocols that are most at risk and helps developers build better defenses.
What Auditors Should Check
If you're auditing a protocol with similar architecture to Phemex, these are the critical security checks that could have prevented this incident (January 2025).
- Verify all logic paths related to Private Key Compromised (Unknown Method) / Other are guarded by proper access controls and input validation - see the Access Control Attacks attack class for patterns
- Review privileged functions (owner, admin, governance) for potential abuse vectors - centralization risks should be documented and bounded with timelocks or multi-sigs
Master these auditing techniques with hands-on labs and real exploit scenarios in the Smart Contract Hacking course.
Free TrialRelated Attack Classes
The technique used in this hack maps to these vulnerability classes in our security curriculum:
Sources & References
Learn to Prevent the Next Phemex
The Phemex hack is one of many attacks that skilled auditors are trained to detect before deployment. Master real exploit patterns and defense techniques with hands-on Web3 security training.