Hacked South Korean Exchange Bithumb Recovers Funds

While blockchain technology remains the most tamper-proof system of data storage, cryptocurrency exchanges are yet to attain the same level of security. On June 20, 2018, reports emerged that Bithumb, the largest cryptocurrency exchange in South Korea, had fallen prey to cyberpunks. Recently, recovery efforts have helped the exchange mitigate the attack.

Salvaging the Situation

Bithumb, which is the seventh largest digital assets trading platform in the world, originally estimated the total stolen funds at around $30 million. Bitcoin suffered the most significant attacks with XRP and Ethereum also taking substantial hits. In total, eleven cryptocurrencies were affected.

The exchange company stated that they countered the attack quickly by working with crypto organizations across the globe and by moving cryptocurrencies to cold wallet storage. Fortunately, their efforts paid off handsomely.

Bithumb has since revised damage estimates significantly after engaging in the recovery process. Damages are now estimated around $17 million.  Along with ongoing recovery efforts, Bithumb has offered to compensate customers via an airdrop.

Security Concerns with Crypto Exchanges

Incidences of hacks in the global cryptospace are quite worrisome for the industry. Since Satoshi Nakamoto created Bitcoin nearly a decade ago, there have been countless attacks on cryptocurrency exchanges, with the most massive cases involving Asian exchanges.

In what has been touted as the most massive crypto exchange heist of all time, hackers hit Coincheck for 526 million units of the XEM altcoin, worth more than half a billion dollars. The January 2018 incident prompted Japanese authorities to increase regulatory oversight in the local digital currency space. The Coincheck hack victims have since been reimbursed and the exchange has announced enormous profits for 2017.

Victims of another infamous heist in Asia, that of the Mt.Gox exchange in 2014, have not been as fortunate, though they now have reason for relief. On June 26, 2018, BTCManager reported that the Mt.Gox victims were on the verge of getting paid their lost funds in Bitcoin as the Tokyo District Court had moved the case from criminal bankruptcy to civil rehabilitation.

In general, given exchange attacks and a downward market trend, this is not the best of times for hodlers and the cryptosphere. At press time, the price of bitcoin is just above the $5K mark, with other cryptos like Ether and Ripple seeing red too.