Cryptocurrency Exchange Hacked, Cryptos Lose $40 Billion As A result

Coinrail, a cryptocurrency exchange based in South Korea, announced they were hacked on Saturday. Korea’s Yonhap estimated that a total of $37.2 million of coins went missing.

However, they did not call it a hack, probably not to panic their clients. They termed it a ‘cyber-intrusion.’ On the plus side, the exchange was alerted before too much damage was done.

The exchange said it secured and moved 70 percent of its cryptocurrency assets in cold storage (offline) wallets, which can transfer coins into a platform that is not connected to the Internet.

In a series of tweets, the exchange said,

There has been a cyber intrusion in our system. We’re confirming it and some coins (Pundi X, NPXS) are confirmed. This is MDL to prevent damage to coins and may cause some coins to be unable to be transferred to the network. We will proceed as fast as possible to avoid damage to you.

This has prompted the suspension of trading on the exchange and investigations of the source of the hack have ensued. The exchange went on to say that it’s working with the affected ICO companies to freeze the stolen tokens.

This news has sent prices of cryptocurrencies into a tailspin, wiping out an estimated $40 billion in virtual wealth. As well as bitcoin, prices for other commonly traded digital currencies like Ethereum also plunged.

Indeed, the continuous growth in the cryptocurrency industry continues to breed more hackers and cybercriminals. Crypto exchanges, wallet providers, and investors have to take extra care in securing their digital asset.

The Coinrail heist will further raise concerns about the lack of regulation in the industry and its the latest in a series of heists at cryptocurrency exchanges, which cybersecurity analysts say is a target for cybercriminals whose primary aim is to amass wealth in the easiest ways possible.

The Coinrail attack comes just months after Japan’s Coincheck cryptocurrency exchange lost $400m worth of digital currency and South Korea’s Youbit exchange was forced to file for bankruptcy and close after two cyber-attacks, while in 2014 MTGox filed for bankruptcy after losing bitcoins worth around $500m. You may even remember that Golix’s user accounts were once compromised.

On the international arena, these attacks have sent down chills to policy makers and authority’s spines. Late last month Zimbabwe even went on to ban the trading cryptocurrencies to protect people from suffering financial loses.

Source: techZim

Sipho Mhlanga

"I didn't come this far, only to come this far. "

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