Humanity Protocol’s H token crashes 90% in $32 million exploit that ZachXBT suspects may be an inside job

Humanity Protocol’s H token collapsed nearly 90% on June 9 after attackers drained more than $32 million from at least 17 wallets by compromising private keys, then blockchain investigator ZachXBT publicly questioned whether the breach was an outside attack at all.

The exploit surfaced after unauthorized actors gained access to private keys associated with the project, enabling them to transfer and liquidate large amounts of H tokens.

The attacker subsequently exchanged the proceeds for Ether and other assets while continuing to exert pressure on the token’s price through additional token issuance activity.

According to market data cited in the report, H fell from approximately $0.68 to as low as $0.079 before recovering slightly. Even after the rebound, the token remained down more than 80% over a 24-hour period.

Attackers drain wallets and flood the market

The security breach quickly evolved into a market crisis as the attacker began selling large quantities of stolen H tokens.

On-chain analysts reported that more than $30 million worth of assets had already been converted into ETH and BNB.

Investigators also identified the minting of 100 million H tokens on BNB Chain, adding substantial new supply to the market and intensifying concerns about further downside pressure.

A subsequent report indicated that another 100 million H tokens had been minted, increasing fears that the attacker could continue unloading tokens despite already realizing significant proceeds from earlier sales.

According to blockchain analytics platform Lookonchain:

 “The hacker still holds 111.36M $H ($14M) ready to be sold. However, on-chain liquidity is nearly exhausted.” Lookonchain, blockchain analytics platform

The combination of token dumping and newly minted supply contributed to a rapid deterioration in market confidence, accelerating the token’s decline and leaving investors scrambling to assess the scale of the damage.

Humanity Protocol confirms private-key compromise

Humanity Protocol acknowledged the incident and attributed the breach to compromised private keys belonging to a member of the Humanity Foundation.

Founder Terence Kwok said the team had already begun coordinating with security specialists and exchange partners while urging users to avoid interacting with parts of the protocol until further notice.

The project advised users to stay away from its bridge infrastructure and liquidity pools while investigations continue.

The announcement represented the first official explanation for the incident and confirmed that the exploit stemmed from compromised credentials rather than a publicly disclosed smart-contract vulnerability.

ZachXBT questions the project’s narrative

The incident took a more controversial turn after prominent blockchain investigator ZachXBT publicly questioned Humanity Protocol’s explanation of events.

In comments shared on social media, ZachXBT suggested the circumstances surrounding the breach appeared unusual and said he was not fully convinced by the team’s account.

“The ‘incident’ seems possibly staged. I am not buying the team’s story.” — ZachXBT, blockchain investigator

The investigator noted that it remained unclear whether the event was solely the result of a malicious external attack or whether other factors could have contributed to the market collapse.

Those remarks fueled debate across the crypto community, with market participants closely monitoring on-chain activity and awaiting additional evidence from investigators and the project team.

At the time of publication, no definitive proof had emerged supporting claims beyond the project’s official statement regarding compromised private keys.

Market fallout and investor concerns

The Humanity Protocol incident highlights the continuing risks associated with private-key management in the digital asset industry.

While smart-contract exploits often dominate headlines, this case demonstrates how compromised credentials can have equally severe consequences for projects and investors.

With millions of dollars drained, hundreds of millions of tokens entering circulation, and questions emerging about the circumstances surrounding the breach, the event has become one of the most closely watched crypto security incidents of the week.

For investors, the episode serves as another reminder that operational security remains a critical component of blockchain infrastructure.

As investigators continue tracking the attacker’s wallets and Humanity Protocol works with external security partners, market participants will be looking for greater clarity on how the compromise occurred and whether additional risks remain.