Skip to main content
Bitfinex hacked

Bitfinex halts trading. Is it a cyberattack? What's the story?

World’s largest cryptocurrency exchange, Bitfinex was reported to have a cyber attack on 5th June 2018. The cyber attack led to a brief pause of the service as the after effect of this attack was a lot of load on the servers. Because of this happening, the price of bitcoin fell by 2 percent. The price of Bitcoin hit low of $7,373.47 after the attack. This is natural, whenever there’s a cyber attack, investors sell their digital assets in a fear of losing it. Even though the price is not that profitable, its any day better than losing it completely.

The price continues to fall among all this. Users selling it sooner, the better. Furthermore, some users also withdraw funds to their hardware wallets. This again leads to a price drop of various altcoins. However, these users have nothing to lose, as they just migrate the funds from exchanges to hardware wallets.

Read Also: Coinbase hacked? The truth revealed in a case study.

Bitfinex was targeted in DDoS attack or a distributed denial of service attack. As part of this attack, the system has multiple virus-infected servers. Which, inarguably, is not under the control of the system owner. That is, someone else controls the server.

"The previous outage was caused by issues with one of our infrastructure providers," the company said on its website. "While the platform was recovering, the attack caused extreme load on the servers."

The service resumed after a short period of attack. Furthermore, the company said they were “monitoring the situation closely”. Before the announcement was made about the attack, the company said the service was paused as part of “Unplanned maintenance”

"The attack only impacted trading operations, and user accounts and their associated funds/account balances were not at risk at any point during the attack," a Bitfinex spokesperson said.

Before this, in 2016, Bitcoins worth $72 million USD were stolen from Bitfinex, after which the company suspended trading for short period of time.  

Another incident with similar result came to notice in January this year. Cryptocurrency worth $500 million USD was stolen from a Japan-based cryptocurrency exchange, Coincheck. In December 2017, a south Korean cryptocurrency exchange service, Youbit, lost 17% of their digital assets. Following which, its parent company, Yapian, declared themselves bankrupt.

A Tokyo-based Mt. Gox lost 750k user’s bitcoin and 100k company’s own. The company was biggest bitcoin exchange before filing bankruptcy after this attack.

Though cryptocurrency is booming day & night, there still a scope to improve in terms of security against unauthorized access.

Did you know that you can support this website by reading it on Brave Browser. Enjoy private, secure and fast browsing with Brave.