bitcoin stolen

Bitfinex, a Hong-Kong based digital currency exchange, halted trading, withdrawals and deposits after announcing a security breach leading to the theft of close to $70 million worth of Bitcoins. The company has not released the total damage, but one of its employee posted on Reddit that the total Bitcoins stolen by hackers was 119,756.

Bitfinex stated that it has reported the hack to law enforcement agencies, while a statement from the company claims that” We are undertaking a review to determine which users have been affected by the breach. While we conduct this initial investigation and secure our environment, will be taken down and the maintenance page will be left up.”

The fall of Bitcoin

After the devastating news, Bitcoin market value declined by over 20% and reached a low of $480 from a high of $613 on Tuesday. The drop in price is unclear but the most likely reason is that Bitcoin investors are nervous now over the threat of potential hacks on other digital exchanges.Investor’s are selling off their Bitcoins, leading to the massive price drop.

Following the hack, many exchanges are anticipated to automatically restrict the amount of Bitcoin that can be withdrawn in a single transaction to limit losses in case of a hack. In addition to this, Bitfinex stated on Reddit that it has placed limits to restrict the amount of Bitcoins that can be withdrawn and also investigating the hack at the same time.

Reminds me of a TV Show

Last year, Bitfinex disclosed a partnership with BitGo, a Palo-Alto based company that offers multiple-signature security. Bitfinex stated that after this partnership, it had enforced a two-step authentication, which includes bypassing Bitfinex and then BitGo, and the hackers needed to compromise both institutions before getting to the funds. However, it remains unclear how hackers bypassed this authentication and stole over $65 million.

This Bitcoin breach should remind readers of a certain TV show that simulates a similar hack, where a cyber-security company is hacked by cyber activists to get access to a multi-billion dollar corporation’s servers. For all of you who haven’t watched the psychological tech drama Mr. ROBOT, you will love it.

The biggest theft in Bitcoin history comes only two months after cyber-criminals stole $60 million worth of Ethereum (Bitcoin’s rival crypto-currency) in June. In 2014, an attack similar to Bitfinex was seen at Mt. Gox, a Tokyo-based Bitcoin exchange,which also caused massive uncertainty amongst BitCoin investors. Hackers stole almost $650 million Bitcoins from Mt. Gox, which forced the exchange to file for bankruptcy.

Ameer Abbas

Ameer Abbas is a senior editor and a most viewed writer on Quora in Internet Privacy, Cyber Security, VPN and Torrents. He has continued work as a privacy advocate with Best VPN Provider and is working towards becoming an established privacy & security author online. Ameer takes a keen interest in technology, geo-political affairs and international cyber laws. Ameer loves outdoor sports including cricket, swimming, athletics, and football.
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