Bitcoin Hacked, Holders Lost Cryptocurrency

A large Japanese cryptocurrency exchange was hacked by unknown hackers, as a result of which $ 32 million was stolen.Almost the entire amount was funds of clients. The problem was identified on 07/11/19, when the platform operator wanted to perform a financial transaction using a Ripple coin, but an error message appeared. As a result, the official wallet that was used to carry out the transaction was reset to zero.
 

Historical reference

According to many experts, such an exchange hacking is not the first in cryptocurrency history. In 2014, the Mt Gox platform went bankrupt as 850 thousand BTC were lost. In 2018, Coincheck was also attacked by hackers who stole $ 500 million of cryptocurrency.It is very difficult to find scammers in such cases, because all actions and transactions are confidential and impersonal. Even based on the use of a digital footprint, it is almost impossible for a hacker to identify a specific organization.
 

Consequences of hacking the exchange

As a result of the hacker attack, the BITpoint Japan exchange stopped its functioning, all transactions were frozen. The platform is owned by Remixpoint. She indicated that the break-in caused losses in the following amounts:

    2.5 billion yen ($ 23 million), which were in the wallets of exchange users.
    1 billion yen ($ 9.2 million) - personal assets of BITpoint.

When the Tokyo Stock Exchange was opened, all Remixpoint shares were down 18.6%. At the moment, they are completely removed from circulation and trading, due to the large number of orders for implementation.

On July 11, Tokyo time at 22:12, employees of a Japanese crypto exchange saw an error that prevented asset transfers. During the proceedings, unauthorized activity and financial actions with the Ripple token were identified.

After 4 hours, platform employees saw the theft of digital assets in a different cryptocurrency. At 6:30 in the morning, an emergency meeting was held, after which any actions with the coins stopped for an unknown period.

The funds were stolen from hot wallets containing 5 different coins, among them:

    Bitcoin;
    Bitcoin Cash;
    Litecoin;
    Ethereal;
    Ripple.

The assets held in cold wallets were kept in full.
 

Bitpoint Hack Investigation

BITpoint Japan is the largest crypto exchange in Japan and operates under all licenses. In 2018, after stealing funds from the Coincheck platform, the FSA checked all licensed companies, as well as crypto exchanges that were in the process of obtaining permits. BITpoint was the last on the list, but it passed the checks.

In February of this year, the exchange was recorded in an incident with the Mt. Gox. Many lenders who were the injured party assured that the manager was using the resource to sell the stolen tokens.

Bitpoint has stopped operations due to theft, and deposits and asset withdrawal orders are temporarily frozen. At the moment, the management of the exchange does not talk about methods of returning funds to clients. In Japan, financial regulators, in such situations, work very hard, so there is likely to be full compensation for losses. There have already been situations in history in which cryptocurrency exchangers participated. After stealing them, regulators forced them to return the money to customers.

The investigation continues, and any news has not yet been disclosed. It is possible that there will be changes in payment for electricity for exchange clients. This is because the platform is run by Remixpoint, a major electricity supplier in Japan that has been operating since 2004.

In addition to its main work, the corporation conducts transactions with the purchase and sale of used vehicles, works in the field of consulting services, and also owns a crypto exchange. Since 2017, platform users have been able to pay their electricity bills through Bitcoin.
 

Blockchain threatens the security of banks

According to statistics, approximately 50% of blockchains and 70% of smart contracts used by lending firms are attacked by hackers. The introduction of new technologies can greatly affect the security of such organizations, with the possibility of a complete loss of control over resources. Analysts believe that even projects that operate on a closed system are often related to the main work of the company, so hackers can seize strategic resources. With this, fraudsters can take full control of financial transactions between banks and ATMs.

Any technologies that are just starting to enter the masses may be unfinished, so the blockchain system is no exception. It is attacked because the programmers are not experienced enough to write the correct code.

Banking tests do not provide an opportunity to assess the degree of protection and reliability of the system in working with critical errors. Test projects are often not available to the public. At the moment, there are no authors of tools who can fully and promptly respond to attacks.

Experience of cryptocurrency exchanges

Bankers constantly admit that blockchain is still a poorly understood network, and the theft of money that occurs on crypto exchanges fully confirms these opinions.

In May, scammers stole 7000 BTC from the Binance wallet, which is equivalent to $ 40.5 million. Hackers used a vulnerability of the platform to access resources and personal data of users, and they were able to overcome two-factor authentication. The developers of the crypto exchange think that the attack was complex, using viruses and phishing.