Protection

The Biggest Thefts and Hacks of Cryptocurrencies

Cryptocurrencies have now become one of the most popular and risky investments. The dangers connected to buying cryptocurrencies include poor security and high subjectivity of the cryptocurrency systems to risks of money thefts and hacks. When one is fully aware of the possible attacks, it becomes possible to revert them. Therefore, here are some of the greatest cryptocurrency thefts.

Enigma ICO Theft

Enigma was founded by a group of MIT graduates, and the project created a strong community of over 9,000 users who joined its mailing list and group in Slack. The hacker managed to break into the Enigma’s website, Slack group, and mailing list and sent fraudulent messages to the project’s community asking for money transfers. All in all, by these means the hacker gathered about $500,000.

As it was found out, Enigma’s CEO Guy Zyskind did not protect his email credentials properly and these were dumped on the internet from the hacking of different services in the past. Unfortunately, due to inaccuracy and inattention to details, Zyskind failed to change the password to his email and this, together with the lack of two-factor authentication setup, allowed the hacker to access Enigma’s website and all of the other information resources.

Coincheck Hack

Coincheck is a Tokyo-based cryptocurrency exchange which was hacked and thus lost $530 million at the time of the break. The hacker had moved 300,000 XEM tokens to another address, and both addresses had been flagged with a mosaic warning other exchanges to not accept the funds. The company owned up to a security lapse that allowed the thief to seize such a large sum. The problem was that it kept customer assets in a hot wallet being connected to external networks.

The key information on this hack provided by Coincheck is as follows:

  • The theft only involved NEM Coins;
  • The hackers managed to steal the private key for the hot wallet where NEM coins were stored;
  • The stolen money belonged to the customers of the exchange;
  • When Coincheck became aware of the breach, they suspended the withdrawals.

Bithumb Break

Bithumb is one of the largest crypto exchanges in the world located in Seoul, South Korea. The hackers made away with cryptocurrencies worth $31.51 million. The exchange has been generous enough to announce that all the losses to the users will be refunded by the exchange with their own coins. Simultaneously, they have also requested their users not to deposit any cryptocurrencies into the exchange until further notice, keeping in mind the safety concerns.

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