The cryptocurrency exchange Bithumb Originating from South Korea, the exchange has appealed to users to halt any deposits into their Bithumb accounts for the immediate future. They assure customers that the losses will be compensated, and that personal financial losses will be avoided. Meanwhile, the crypto market has reacted with a dip in prices following the unsettling news. Bithumb has remained quiet about which specific cryptocurrencies were affected.
Korean Exchanges a Prime Target
Bithumb's recent announcement didn't exactly come out of the blue, considering the ongoing attacks plaguing exchange platforms. South Korean exchanges seem to be favored targets for these cybercriminals, with recent breaches successfully infiltrating other platforms. Coinrail which lost $40 million, Coinlink whose attack Connections have been rumored linking some of these hacks to North Korea, and now Bithumb finds itself entangled in these speculations.
Every time a South Korean crypto platform gets hacked, it doesn't take long before fingers are pointed towards North Korea as being behind the breach. While some cases might have evidence to back up such claims, like the Coinlink incident, we are yet to verify if this recent situation falls under the same pattern.
2018 a Costly Year
Although hacking crypto exchanges is not a new phenomenon, 2018 has evidently been a particularly lucrative year for hackers. It seems hardly any time passes before another high-profile breach surfaces. Reports from Business Insider have suggested that by April, substantial sums had been drained via a blend of scams and cyberattacks. $670 million had been stolen Besides directly targeting exchange wallets, a variety of other forms of attacks have been gaining momentum.
For example, Binance fell victim to an elaborate phishing scheme that employed a deceptive web address resembling the legitimate one. The stolen credentials were later used by an automated system that liquidated the victims' assets, trading them for Bitcoin, before converting these into a lesser-known cryptocurrency named Viacoin. However, the hack eventually flopped as it didn't yield any profit for the attackers.
Another notable incident in 2018 saw MyEtherWallet facing a DNS spoofing attack, redirecting unsuspecting visitors to a fraudulent phishing site. phishing attack Bithumb has made an urgent appeal to their esteemed customers to withhold any deposits to their Bithumb wallets until further notice.
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In the aftermath of most crypto mishaps, the financial burden is typically shifted onto the users. For instance, following previous breaches, Bitfinex users endured cuts across their crypto holdings.
No Customer Losses?
While this redistribution might appear fair to some, for those who were not directly affected, this approach might feel unjust.
— Bithumb (@BithumbOfficial) June 20, 2018
A Tweet initially assuring user compensation was later removed, drawing a reaction from the official account that elaborated further. taken by the exchange in an attempt to spread out the damage.
A crucial lesson from these events is the persistent vulnerability of exchanges to hacks and the community's apparent misunderstanding of the risks. Firstly, exchanges require stringent security reinforcements to prevent these occurrences. If not addressed, the sustainability of the cryptocurrency landscape is at risk as large assets continue to vanish.
A second critical reminder for users is to refrain from storing their digital currencies on exchanges. The primary role of exchanges is to facilitate trading and not to act as a repository for crypto possessions. Therefore, users must responsibly manage their assets and ensure they maintain direct control.
https://twitter.com/BithumbSupport/status/1009291714215993345
Lessons still Unlearned
As the often-quoted Bitcoin expert Andreas Antonopoulos rightly points out, 'If you don't control your private keys, you don't own the coins.'
Perhaps the coming years might herald the rise of decentralized exchanges, considering the security challenges impeding their centralized counterparts.
Robert, as a dedicated News Editor at Blockonomi, is passionate about the empowerment and discretion promised by the emerging digital economic models. He has actively contributed to the crypto sphere for years and can be reached at [email protected].
Dark web operatives claim to hold substantial leaked user data from Gemini and Binance.
