South Korean exchange Bithumb has once again fallen victim to hackers, losing a staggering $31m in cryptocurrency. This marks the second attack on the exchange in just a year, highlighting the ongoing risks faced by digital currency platforms.
The attack on Bithumb, one of the world’s largest digital currency exchanges, was discovered after approximately 35bn won ($31.5m) was stolen. The firm has taken immediate action by halting deposits and withdrawals while conducting a thorough investigation into the breach.
In a statement, Bithumb assured its users that all lost funds would be covered by the company’s own reserve. Additionally, remaining assets have been transferred to a secure cold wallet to prevent further losses. Ripple is among the currencies believed to have been affected by the attack.
Despite its significant trading volume of over $370m, Bithumb has faced previous security breaches. In July 2017, hackers stole personal information from 30,000 customers by compromising an employee’s laptop. This resulted in a phishing campaign that led to the theft of funds from customer accounts.
The cryptocurrency market has been a frequent target for cyber-attacks, with Bithumb’s rival Coinrail losing $37m earlier this month. Similarly, Slovenian marketplace NiceHash suffered a $64m loss in December 2017 due to a cyber-attack.
These incidents serve as a warning to investors about the risks associated with the cryptocurrency market. North Korean hackers have been linked to spear-phishing attacks on exchanges and illegal cryptomining activities as a means of generating funds for the regime of Kim Jong-un.
Kevin Curran, a cybersecurity expert at Ulster University, emphasized the increased threat to cryptocurrency organizations as the value of digital currencies continues to rise. He explained that once stolen tokens are transferred, they become virtually untraceable due to mixing services that create new, unidentifiable tokens.
It is crucial for investors to be aware that Bitcoin transactions are not protected by refund rights or chargebacks, as highlighted by the European Banking Authority. These ongoing cyber-attacks underscore the importance of robust security measures for digital currency exchanges to safeguard user funds and prevent future breaches.