Home Articles How Hackers Stole $32 Million Worth Cryptocurrency Assets

How Hackers Stole $32 Million Worth Cryptocurrency Assets

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Recently, hackers stole $32 million worth funds in five cryptocurrencies from from Bitpoint Cryptocurrency Exchange. Read on to know more…

Recently, hackers stole $32 million (3.5 billion yen) worth funds in five cryptocurrencies, including Bitcoin, Bitcoin Cash, Litecoin, Ripple, and Ethereal. The Japan-based cryptocurrency exchange noted that out of the stolen money were customer funds, while the rest were reserve funds owned by the exchange. RemixPoint, the legal entity behind Bitpoint, said that hackers breached the Bitpoint exchange network on July 11, 2019, and stole funds from both of its ‘hot’ and ‘cold’ wallets.

The Breach
In a more detailed document released by RemixPoint, the legal entity behind Bitpoint, it was reported that hackers stole funds from both of its “hot” and “cold” wallets. This suggests the exchange’s network was thoroughly compromised. Hot wallets are used to store funds for current transactions, while the cold wallets are offline devices storing emergency and long-term funds.

The exchange said it detected the hack because of errors related to the remittance of Ripple funds to customers. Twenty-seven minutes after detecting the errors, Bitpoint admins realized they had been hacked, and three hours later, they discovered thefts from other cryptocurrency assets.

This is the latest hack involving cryptocurrencies, which have become synonymous with vast fluctuations in value, being used in criminality and frequent theft through hacks.

Damage Control
The cryptocurrency exchange suspended all the transactions including all deposits/withdrawals and to investigate the hack. The exchange also notified the law enforcement authorities about the incident.

“Today, we have stopped the remittance (sending) and receiving (depositing) services from 6:30, but we will stop all services including transactions and sending and receiving from around 10:30. We apologize for the great inconvenience to our customers, but we appreciate your understanding and cooperation,” Bitpoint said in a notice posted on its website.

Remixpoint said it would compensate customers for the losses. About ¥2.5bn-worth of the missing currency was customer funds, with the rest owned by the firm.

Earlier Breaches
Bitpoint is the third major Japan-based cryptocurrency exchange to suffer a major hack in the past years. In September 2018, the Zaif cryptocurrency exchange lost $60 million following a hack. In 2017, cryptocurrency exchange Coincheck was hacked for $530 million.

In 2017 the South Korean exchange Youbit shut down and filed for bankruptcy after being hacked twice. The Tokyo-based MtGox exchange, which at one time handled almost 80% of all global bitcoin transactions, was shut down in 2014 after 850,000 bitcoins (worth half a billion US dollars at the time) disappeared from its virtual vaults.

Both exchanges were forced by Japan’s financial regulators to pay back customers after their hacks.

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