Is the Korean exchange hack is responsible for the fall of Bitcoin?
Bitcoin suffers a sharp drop in price after the hack of Coinrail – A South Korean cryptocurrency exchange.
According to a tweet from Coinrail, the cyber-attack leads to a 10% drop on Sunday.
According to coinmarketcap.com, Coinrail has 98th rank in the world. It trades 50 coins and has $2.65 million trade volume.
Coinrail, one of the best trading platforms lost $500 in an hour, resulting in a drop to $6,627 on the Luxembourg exchange Bitstamp.
Kim Jin-Hwa, the head of the Korea Blockchain Industry Association, says the company is a minor player and he expects more exchanges to be exposed in the future if they continue to practice traditional security principles.
The Coinrail incident is the fifth major hack in 2018. The speculations of future exchange hack begun to crop up in January when Japanese exchange “Coinheck” suffered a hack of about half-a-billion in cryptocurrency. One of the major victims is “BitGrail” in Italy, which lost about 200 million worth of cryptocurrency in seconds. The third victim is “Coinsecure” and lost about $3 million worth of bitcoin stolen from its wallet in April.
A significant attack has recently occurred on Japan’s Shopin, which is a universal shopper profile based in Japan. The attack was on one of the company’s token distributors, leading to a loss of $10 million tokens. In spite of being attacked, the distributor continued to keep all tokens in hot wallet storage after receiving a number of warnings from Shopin executives, who claim to send instructional videos regarding the wallet to be used.
Adrian Lai, founding partner at Hong Kong-based investment firm Orichal Partners states that investors are looking for upfront ways to solve cybersecurity issues. Exchanges really need to upgrade the level of security to secure Mining Pools, he said.
Coinrail attack has put the question on the security of platforms and weak regulations of the cryptocurrency industry. According to the statement of Coinrail, the attack is a cyber intrusion, leading to the loss of 30% of the coins traded on the exchange. Coinrail did not mention the total loss; however, the calculations of the local Yonhap news agency reveal that on average 40bn won are being lost.
In response to an attack, Coinrail stated that about seventy percent of total coins and token reserves have been moved to a cold wallet. Moreover, it has withdrawn two-thirds of stolen cryptocurrencies in a partnership with other exchanges.
Presently, coinrail is looking into the matter with the help of an investigative agency.
Author: Danish Wadhwa
