Kraken Users Temporarily Locked Out After 'Dust Attack' From Sanctioned HTX Wallet

Kraken Accounts Briefly Frozen After Small Crypto Transfers

Crypto exchange Kraken said its users were temporarily locked out of their accounts after receiving tiny amounts of digital currency from a wallet linked to HTX, a crypto exchange sanctioned by the European Union. These small transactions, known as a "dust attack," triggered compliance checks on the platform.

A dust attack happens when very small amounts of cryptocurrency—often just a few cents—are sent to many wallet addresses. The goal is usually to track or disrupt those accounts. In this case, the funds came from a wallet tied to HTX, which was sanctioned in July for allegedly helping Russians evade sanctions.

Kraken restored access to affected accounts quickly but kept the sanctioned funds locked as required by regulations.

What Happened in the Attack

• Around 12,000 small transactions were sent from an HTX-linked wallet to Kraken users this month.
• The transfers were identified as a dust attack, a method used to spread sanctioned funds or disrupt services.
• Kraken’s compliance team acted fast to restore account access while keeping the sanctioned funds frozen.
• The exchange is working with authorities to prevent further disruptions.

Kraken’s Response to the Incident

A Kraken spokesperson told Bitcoin Magazine that the exchange does not know who is behind the attack. The spokesperson said the attackers likely expected the sanctioned funds to trigger account locks, causing problems for many users.

"We are working with authorities to ensure these attacks don’t have their intended impact," the spokesperson added.

Why HTX Is Under Sanctions

The European Union sanctioned HTX (formerly Huobi) in July 2026. Authorities accused the exchange of helping Russians bypass financial restrictions. The dust attack appears to be an attempt to spread sanctioned funds to other platforms, according to Kraken.

What Is Confirmed

• Kraken users received small amounts of cryptocurrency from an HTX-linked wallet.
• The transfers were part of a dust attack, a known method for tracking or disrupting accounts.
• Accounts were temporarily locked but later restored.
• The sanctioned funds remain frozen as required by law.
• HTX is under EU sanctions for allegedly helping Russians evade restrictions.

What Is Still Unclear

• The identity of the person or group behind the dust attack remains unknown.
• It is not confirmed whether the attack was directly ordered by HTX or carried out by a third party.
• No details were provided on the exact amount of cryptocurrency sent in each transaction.

Why This Matters for Crypto Users

Dust attacks can cause unexpected account freezes, even if users did nothing wrong. Exchanges must follow strict rules when handling sanctioned funds, which can lead to temporary access issues. This incident shows how compliance checks can affect regular users, even when the problem comes from outside the platform.

Sources

• Bitcoin Magazine
• Bloomberg