Hackers steal $72 million from Hong Kong Bitcoin exchange, Bitcoin price fall by 20%

Hackers steal $72 million from Hong Kong Bitcoin exchange, Bitcoin price fall by 20%

Hong Kong-based bitcoin exchange Bitfinex suspended trading after almost 120,000 units of digital currency, together worth $72 million at the time, was stolen by the hackers from online customers. This cyberattack is said to be the second-biggest security ever of such an exchange. After the news of the theft broke out, the value of Bitcoin plunged more than 20 percent early on Wednesday in the trading market.

Bitfinex, which is one of the largest exchanges for Bitcoin, and known in the digital currency community said it had halted trading, deposits and withdrawals while it probed which users had been affected.

Zane Tackett, Director of Community & Product Development for Bitfinex, told Reuters on Wednesday that 119,756 Bitcoins had been stolen from users’ accounts.

“The bitcoin was stolen from users’ segregated wallets,” he said.

The volume stolen amounts to about 0.75 percent of all Bitcoin in circulation, Reuters says.

Bitfinex said in a blog post that any outstanding clearances would be made at the price before the hacking. “As we account for individualized customer losses, we may need to settle open margin positions, associated financing, and/or collateral affected by the breach,” Bitfinex added.

“We will look at various options to address customer losses later in the investigation,” Bitfinex added. “We ask for the community’s patience as we unravel the causes and consequences of this breach.”

It is not clear whether the theft was an inside job or whether hackers were able to gain access to the system externally. Tackett said on an online forum that he was “nearly 100 percent certain” that it was no one in the company.

Meanwhile, Bitfinex has shut down its platform while they work together with law enforcement and probe “the causes and consequences” of the security breach, according to a blog post from the company.

“The security breach comes two months after Bitfinex was ordered to pay a $75,000 fine by the U.S. Commodity and Futures Trading Commission in part for offering illegal off-exchange financed commodity transactions in Bitcoin and other digital currencies,” Reuters reports.

The attack on Bitfinex was suggestive of a similar but biggest breach at MtGox, a Tokyo-based Bitcoin exchange in 2014 that shook the Bitcoin economy. The hackers stole an estimated $650 million worth of customers’ Bitcoins forcing the exchange to file for bankruptcy thereafter.

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