A South Korean exchange, Bithumb, has reportedly been hacked, resulting in the loss of 35 billion won worth of cryptocurrencies it was storing.
Bithumb Targeted Again
Seoul-based Bithumb, the sixth largest cryptocurrency exchange, according to CoinMarketCap, saw assets being seized yesterday and today, according to a Bithumb statement.
Yesterday, the crypto exchange announced that it would be temporarily suspending its deposit service as it went about changing its wallet service. Shortly thereafter, Bithumb revealed that it would be suspending all of its withdrawal and deposit services.
Bithumb urgently ask our valuable customers not to deposit any fund into Bithumb wallet addresses for the time being.
— Bithumb (@BithumbOfficial) June 20, 2018
The reason? Bithumb had discovered that cryptocurrencies valued at $30 million had been stolen. It went on to say that all stolen assets will be covered by the exchange, with remaining coins being transferred into cold storage.
Interestingly, since the promise of reimbursing customers’ assets was announced, it has been taken off Twitter. Unsurprisingly, the removal has many questioning what’s going on.
Why you delete compensation tweet??? #SKETCHY
— BIGDAWG (@woofBIGDAWG) June 20, 2018
The news of the hack saw market prices responding with a significant number of coins, including Bitcoin, Ethereum, and Ripple, falling in value.
This, however, is not the first time that Bithumb has been targeted. Last July, the BBC reported that the exchange had been breached. At the time, it was reported that an employee’s computer had been hacked, resulting in the personal details of 30,000 customers being stolen. The information was then used to trick users into letting thieves steal funds from their accounts.
This latest hack, though, further highlights the risks that cryptocurrency exchanges face from criminals. It’s not known whether the stolen coins were stored in hot wallets. In Ho, a professor at Korea University’s Blockchain Research Institute, thinks it’s likely they were, reports Reuters. In Ho said:
Since coins in the cold wallets are not at all wired to the internet, it would have been impossible for hackers to steal those in cold wallets unless they physically broke in.
Seoul police have since launched an investigation into the hack, collecting records and data from the company’s computers.
Second Hacking Attack in South Korea in Two Weeks
The incident at Bithumb comes several weeks after another hack was reported to have taken place at South Korean crypto exchange Coinrail.
Earlier this month, the exchange said it had been the victim of “cyber intrusion,” causing a loss for about 30 percent of the coins traded on the exchange. It’s estimated that 40 billion won, or $37.28 million, worth of cryptocurrencies was stolen.
Even though Coinrail is a relatively small crypto exchange in South Korea, its hack still managed to send the price of Bitcoin to two-month lows.
How do you think this latest hack will impact market prices in the short and long-term? Let us know in the comments below.
Images courtesy of Shutterstock, Twitter/@BithumbOfficial, and Twitter/@woofBIGDAWG.