It was announced today that one of the world’s biggest cryptocurrency exchanges, Bithumb, recently fell victim to a massive breach. Which resulted in the loss of roughly 35 billion Won, which equates to over 30 million USD.
What went down
The attack on Bithumb took place overnight between Tuesday, June 19th and Wednesday, June 20th. As of right now, it is unknown which specific crypto was targeted, nor how much was taken. Additionally, it is not quite clear as of the time of this writing as to how the funds were stolen. Though the exchange has advised users to not deposit until exchange personnel finishes a wallet upgrade.
[Notice for the temporary suspension of the deposits]
Due to the increasing safety issues, we are changing our wallet system.
Please do not deposit until we notify.
*All deposits are not deposited into your wallet until all changes are completed.
— Bithumb (@BithumbOfficial) June 20, 2018
Whats interesting to note is that last year, Bithumb was also a victim of a big breach, which resulted in the data of over 30,000 users being compromised.
The exchange was also previously fined by the South Korean government for being careless with user information. Apparently, the situation evolved around the mishandling of client information and account theft.
Bithumb was also investigated for potential tax evasion in the past. The investigation was carried out by Koreas National Tax Service, Financial Intelligence Unit, and Financial Services Commission. While no tax evasion was uncovered, the exchange was still forced to cough up close to 30 million USD to cover back taxes.
This makes for a double whammy since the exchange did promise to cover lost funds in the most recent hack.
Over the course of the last year, exchanges have become prime targets for hackers. This definitely spells out the need for higher security standards and care for user funds. It also opens up room for government bodies to impose more stringent regulations. While regulations may decrease market volatility, they are definitely needed for the cryptoshere to become more mature and mass adopted. Additionally, this opens up room for increased decentralized exchange popularity.