The native token of Kaito AI, an AI-driven crypto data network, briefly plummeted nearly 10% on Saturday after hackers compromised both the project’s official X account and the personal account of its founder, Yu Hu. The attackers used the breach to spread unfounded rumors, falsely claiming issues with Kaito’s wallets, triggering panic in the community.
Once control was regained, Yu Hu took to X to calm investors, assuring them:
“I have regained control over my X account. To reiterate – KAITO wallets are safe. We are investigating how the X compromise happened.”
The coordinated attack saw the dissemination of false warnings, claiming irregular activity in wallets linked to the project. One particularly alarming post from Kaito’s official account cautioned users about “irregular activity in multiple wallets linked to Kaito AI,” while a similar message from Hu’s compromised account added, “The funds are not safe for now. Be cautious please.”
These unfounded alerts understandably caused concern within the community, leading to a swift but temporary dip in the KAITO token price. However, despite the initial panic, blockchain data shows no significant outflows or unusual large-scale movements of Kaito tokens occurred during the incident. Both misleading posts have since been deleted.
Kaito’s research partner Sandra Leow pointed out that the hackers strategically waited until Yu Hu’s local timezone, when he was likely asleep, to execute the attack, increasing its chances of causing maximum disruption.
Despite the initial sell-off, Kaito’s token quickly recovered after the team’s swift clarification, and the Kaito network confirmed that all wallets and funds remained secure.Kaito’s native token plays a key role in powering its network by incentivizing active contributors, known as ‘yappers,’ who publish engaging crypto-related posts across social media.
Investigation Links Kaito Hack to Broader Attack Campaign
Following the security breach, new findings suggest the attack may be part of a broader, coordinated hacking campaign targeting high-profile crypto accounts. On Sunday, Yu Hu provided an update on the situation, revealing that leads point to a connection between the Kaito hack and the recent compromise of the @tier10k account, a well-known crypto news aggregator. According to information provided by on-chain analyst @DefiSquared, the same hacker appears responsible for both incidents, and has allegedly profited close to $1 million in total from these orchestrated exploits.
Specifically, the attacker is reported to have leveraged positions on the decentralized perpetuals exchange Hyperliquid, earning an estimated $300,000 from the Kaito-related trades alone. Two wallet addresses believed to be involved in these trades have been publicly identified by Yu Hu, with funds traced to transactions front-running both the DB hack and the Kaito incident.
Interestingly, despite the breach, Yu Hu noted no abnormal login records or device access history on X accounts tied to Kaito. There were no email notifications about unauthorized logins, and throughout the attack, neither Hu nor the Kaito team were logged out of their accounts. Other platforms such as Discord, email systems, and wallets remained unaffected, leading the team to conclude that the breach is likely isolated to X’s internal systems or vulnerabilities, rather than a result of user-side operational security lapses.
Hu emphasized that two-factor authentication via hardware devices was enabled at all times, and the team has consistently maintained strict operational security protocols.
Quick Facts:
- Kaito and founder Yu Hu’s X accounts were hacked on March 15, 2025.
- Hackers falsely reported a compromise of Kaito’s wallets to incite panic among users.
- Attackers opened short positions on KAITO tokens, aiming to profit from the induced price drop.
- Kaito confirmed that user wallets were secure and unaffected by the social media breach.
