Published: Wed, June 20, 2018
Economy | By

South Korean crypto exchange loses $31 million from hack

South Korean crypto exchange loses $31 million from hack

Bithumb holds cryptocurrencies worth 6.36 trillion won, including coins worth 416 billion won of its own, as of the end of 2017, it said in an audit report released in April.

While the company has not disclosed what kind of coins were lost, it has promised to compensate the losses to the affected customers.

At a phase in which the local cryptocurrency exchange market of South Korea started to regain the trust of the public, Bithumb suffered a security breach, for the third time in 12 months. Global policymakers have warned investors to be cautious in trading the digital currency given the lack of broad regulatory oversight.

"Since coins in the cold wallets are not at all wired to the internet, it would have been impossible for hackers to steal those in cold wallets unless they physically broke in", said In, a blockchain expert at the research centre. But, if Bithumb had stored a significant chunk of its holdings in a hot wallet, the breach could have gotten a lot worse.

The virtual currency was priced at $6,442 dollars late afternoon in Seoul, down about 4.4 percent from 24 hours earlier, after the latest attack on Bithumb raised concerns over cryptocurrency security.

On June 11, another South Korean cryptocurrency exchange Coinrail also said it was hacked.

South Korea was at the center of last year's global crypto-mania, playing host to some of the world's most active exchanges. But the government said it does not intend to go as far as shutting down domestic exchanges.

The size of the CoinRail hack was larger than the latest Bithumb hack, given that Bithumb only lost $30 million in its recent attack.

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