Crypto Exchange
Several lawsuits have been filed against the cryptocurrency exchange Coinbase after they were hacked last month. It was revealed that the company didn’t use version control software to maintain their site’s source code, making it easy for anyone to overwrite the code and make changes. According to reports, hackers are from North Korea. Despite this, Bithumb said they were working with the police to recover the stolen funds. They are still investigating the matter, but so far, they have promised to compensate users.
The latest attack on Binance was the biggest hack of all time. The exchange lost over $700 million worth of Bitcoin in one transaction. The company also revealed that more than 7,000 Bitcoin had been withdrawn by the hackers in a single attack. The incident isn’t the first high profile exchange to be hacked. In 2011, Mt Gox was hacked, but the attackers were unwilling to compensate investors.
The hacks on cryptocurrency exchanges are similar to bank heists, but the lack of public scrutiny makes them less appealing to the general public. While the dollar amounts involved are large, the criminals rarely get caught. Most of the time, there’s little closure for consumers. The lack of physical evidence and real world aftermath means that the exchange can’t get rid of the hackers until the hacker is arrested. And since exchanges are mainly private, many victims don’t want to be publicly identified.
How a Crypto Exchange Has Been Hacked
Upbit announced in a tweet that it had been hacked, but didn’t post the details on its website or in an official press release. The company later announced that the amount was $196 million. This was later updated by a security firm. In the meantime, many investors are wondering what will happen to their funds. The Bitcoin network is very secure, but the risk of losing coins is always there. But if the cryptocurrency exchanges aren’t regulated, it will be a long time before it is regulated.
Almost every crypto exchange has been hacked at one point or another. In fact, some were as big as Coincheck and QuadrigaCX. A centralized custodianship is very vulnerable. For example, a centralized exchange can be compromised by cyber-attacks. If an attack is suspected, there are no backup systems for users’ funds. There are also no laws protecting the assets of users.
Although this hack was not technically a crypto exchange, it demonstrates the risks of centralized crypto custodianship. The hacker used the website to send malware to users’ wallets. They were able to steal $190 million worth of bitcoin. They then destroyed the cryptocurrency assets. Fortunately, there is no need to worry about a centralized custodianship. The government can monitor the transactions and stop the hackers from stealing funds.