Major Korean Crypto Exchange: $31 Million Vanishes

Korean crypto exchange Bithumb says it lost over $30M following a hack

Korean crypto exchange Bithumb says it lost over $30M following a hack

Bithumb exchange was hacked losing $32m in cryptocurrencies.

"Bithumb said it had lost $31.56 million (35 billion won) worth of cryptocurrencies and has temporarily halted withdrawal and deposit services", The Wall Street Journal reported on Wednesday.

Earlier this year, North Korea was linked to attacks on South Korean cryptocurrency exchanges, and a previous report said North Korean hackers targeted four South Korean exchanges last summer. "It is not that we cannot see which "wallet" these "coins" have been transferred into but rather that the stolen tokens can be transformed into "fresh" tokens by using "mixing services", which create new untraceable tokens", he explained.

The South Korean hacks show "how ill-prepared a lot of the exchanges still are across large markets", said Vijay Ayyar, the Singapore-based head of business development at Luno, a cryptocurrency exchange. "However, this loss will be compensated by Bithumb's own reservoir, and all of our assets are securely saved in Bithumb's cold wallet". Trusting an exchange with funds is a bad idea due to the fact that it creates a "honey bag" effect to hackers who seek to break into the system for the sole objective of seizing the digital assets.

The exchange, the sixth busiest in the world according to Coinmarketcap.com, said it has stored "all of clients assets in safe cold wallet", which operates on platforms not directly connected to the internet. But, the attack has yet again spurned questions of security and regulation amongst these giant exchanges.

Trump Renews Defense of North Korea Agreement
Donald Trump said he wishes people would "sit up and pay attention" to him the way they do in North Korea when Kim Jong Un speaks. So, how exactly does Kim Jong Un - aka Trump's new buddy - treat "his people?" Pressed on that record, Trump demurred.

One cyber security worker said, "The victims of hacking attacks against exchanges are the customers, so we need to come up with tougher measures". In June 2017, a computer of a Bithumb employee was hacked leading to access information of 30,000 users being leaked.

The attack on Bithumb has brought an immediate impact on prices for virtual coins.

At the time of writing, one bitcoin was trading at $6,626.19 (£5,035) - representing a 1.4% drop from its level before news of the heist spread.

If the exchange does not protect the coins well enough and gets hacked, it doesn't really change the fundamentals of the coin they are protecting.

Recommended News

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.