Bitcoin

Bithumb Confirms it Will Reimburse Users Affected by the Recent Hack

6th Largest Crypto Exchange in the World Hacked - $30 Million Stolen

South Korean crypto exchange Bithumb, ranking among the biggest exchanges worldwide, said that it will reimburse all users, whose funds were stolen in the hacker attack earlier this week. In a report to to the Korea Internet & Security Agency (KISA) Bithumb claimed that over $30 million worth of digital assets were stolen. In the hours before the hack, Bithumb ranked 6th among all crypto exchanges by 24 hour trading volume but has since dropped to 10th spot, according to CoinMarketCap data.

In an official statement the company claimed that, “After the incident occurred on June 20, Bithumb quickly followed the procedure to immediately report [the] incident to KISA announcing that about 35 billion Korean Won worth amount of cryptocurrency was stolen. However, as we undergo recovery process on each cryptocurrency, the overall scale of damage is getting reduced. Hence, we expect that the overall damage will be less than the amount we initially expected.”

Luckily, the exchange followed the security measures, recently introduced by the Korean regulators and thus will be able to cover its user losses, using funds stored on a so-called cold wallet.

Ledger Nano S - The secure hardware wallet

The Korean exchange went on to add that, “Bithumb has been administering company’s asset and customers’ asset, and all customers’ cryptocurrencies, as well as KRW asset, are safely stored on cold wallet and bank respectively. Moreover, we would like to ensure that Bithumb currently has about 500 billion KRW worth of company’s fund. The amount of damage that occurred this time will be fully covered by Bithumb’s own company fund.”

Bithumb has provided no details on the attack so far, although XRP is widely believed to have been targeted by the attackers. The exchange also said it “believes customers can use Bithumb safely“, as the deposit and withdrawal services should be resumed in a short while. Additional measures of customer asset protection and improved wallet system will also be implemented in the coming days, to hinder hacker efforts further down the road.

The exchange has had its fair share of difficulties, as it has just been given a license to operate in South Korea, following a three month long investigation by the authorities. Bithumb has also suffered from numerous hacker probes in 2017.

The hack also casts further doubt over the nascent cryptocurrency market, especially in South Korea, as Coinrail, another Korea-based exchange, has lost $40 million worth of digital currencies earlier this month. The Korean regulators have been hard at work in constantly developing new security measures and we can only hope they will prove to be enough to stop hackers from tarnishing the image of virtual currencies.

While the hack is undoubtedly a hit to Bithumb, the company will clearly be able to recover, albeit with some significant losses. Nonetheless, it pales in comparison to the Coincheck hack in January, which resulted in losses of over $530 million. As a result, Coincheck was bought out by the online brokerage Monex and the regulators quickly introduced new crypto rules.

Image Source: “Flickr”

Ledger Nano S - The secure hardware wallet

I have been following the crypto markets since mid 2017, just in time to witness the incredible surge of the digital asset industry. Fascinated by the potential of blockchain technology I’ve started to dig deeper and that’s how I ended up meeting the Toshi Times team. I hold a Political Science degree, therefore the crypto regulation development is particularly interesting for me. I’m also heavily involved with music, running my own label, a YouTube channel and working with distribution. People call blockchain the ‘Fourth Industrial Revolution’ and I believe it will change our daily lives in the coming years and we will have the front row seats to witness it.