- Poloniex and HTX, both owned or advised by Justin Sun, recently withdrew large sums from the AAVE lending platform.
- Poloniex’s
- HTX extracted $800 million in stablecoins and 30,000 ether ($103 million) from AAVE, also shifting the ether to Lido for staking.
- Justin Sun had promised a third-party proof-of-reserves audit for Poloniex but later stated the exchange cannot meet the necessary requirements due to unspecified issues.
- It remains unclear why these exchanges hold large reserves on AAVE and frequently move them, mimicking trader-like behavior rather than typical exchange reserve management.
Poloniex and HTX, exchanges linked to Justin Sun, have withdrawn hundreds of millions of dollars from the decentralized lending protocol AAVE in early November. These transactions involve moving significant amounts of cryptocurrency reserves, including ether and Tether stablecoins, and redepositing some of these assets into staking services. The reason behind these unusual reserve movements has not been disclosed.
On November 5, the address labeled “Poloniex 9” on Etherscan withdrew 45,000 ether (ETH), valued at about $154.5 million, from AAVE and quickly transferred those funds to Lido, a platform for ETH staking. This same address was previously used by Sun to request the return of funds stolen in a past Poloniex hack, according to this tweet.
Similarly, HTX executed multiple AAVE withdrawal transactions from an address tagged as “Huobi: Recovery.” This included removing $500 million and then $300 million in tether stablecoins, followed by withdrawing 30,000 ETH (roughly $103 million). The ETH was subsequently moved to Lido for staking. These moves happened at the same time as the Poloniex withdrawals.
Previously, Justin Sun had assured users that Poloniex would undergo a proof-of-reserves process with third-party verification—essentially an audit to confirm the exchange’s held assets. However, Sun later announced that challenges at Poloniex prevent it from fulfilling the requirements needed for this verification. Neither Sun nor the exchange has clarified what these issues entail.
These large holdings and active reserve movements on AAVE are unusual for exchanges, which typically do not manage reserves with rapid or frequent transfers resembling typical trader activity. Attempts to obtain comment from Poloniex and HTX about the motivations behind these transactions were not immediately successful.
For more information, see the original article on Protos.
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