Cryptocurrency hacks reportedly caused the loss of more than $673 million in 2018. And since the advent of Bitcoin and the cryptocurrency market, these losses have amounted to billions. And although Western exchangers are not immune to hackers, Asian exchanges are the most common victims. For example, Coincheck, Coinrail, Bitfinex, Bithumb, Mt.Gox and Zaif lost about $1.004 billion in total.
And although many security gaps in crypto exchanges can be attributed to the young age of the industry, Asian developers do not seem to learn from their mistakes, because successful attacks on exchanges there occur to this day. This state of affairs has many wondering - why is this happening?
Lack of vigilance?
A 2016 study by Mandiant, an American information security company, found that Asian organizations have the worst level of cybersecurity in the world. Additionally, Adura's head of cyber security, Barnaby Grosvenor, said:
“One of the main challenges is the lack of clear cyber security laws that can be enforced at national and regional levels. Our analysis of the Asian market found that 99% of web servers have missed at least eight critical updates due to weak technical capabilities. Organizations cannot afford to continue to ignore these key details as the risk of hacking is too high.”
A liberal approach to listing coins?
Another possible reason for the large number of hacks on Asian exchangers could be a liberal approach to listing new cryptocurrencies. Exchanges such as Bitfinex, Bithumb and Coinrail, for example, support a huge number of altcoins whose network security is in doubt, some of which are also susceptible to attacks.
But the largest US exchanges - Coinbase, Gemini and Kraken - have taken a tougher stance on adding new assets to their platforms. These exchanges do not add a huge number of digital currencies and tokens, they prefer to support only the most proven and liquid assets. In addition, each of these assets undergoes a rigorous selection process.
Are North Korea and China attacking neighboring countries?
Proximity to China and North Korea, which are believed to be frequent users of their “cyber power,” may also be one of the reasons for the high number of hacks on Asian crypto exchanges. A large number of attacks on South Korean exchanges can be explained by tense relations with its northern neighbor.. Although there is no direct evidence of this, the North Korean government has every incentive to sponsor hacking attacks on South Korean exchanges.
In addition, it is estimated that there are currently 50,000 hackers serving in the Chinese military. The ambitions of the Chinese government to lead in cyberspace and get ahead of the United States in the development of quantum computers are few secrets. The People's Bank of China is also actively investing in cryptocurrency and blockchain research in order to create a national digital currency.
How can the government improve the level of protection for cryptocurrency investors?
A good place to start is by regularly auditing exchanges and the security protocols they use. Several countries have already begun regulating local cryptocurrency exchanges, and some are in dialogue with exchange representatives to understand how they operate and how best to regulate the new asset class.
If governments want to legitimize cryptocurrency assets while still wanting to protect investors, they can offer an asset insurance program. It is unlikely, however, that governments will do so given the volatile nature of digital currencies. A more likely option is that governments will require exchanges to fully insure client funds against loss due to hacking or robbery.
Finally, investors who are involved in digital assets need to be savvy on this issue. Government agencies could encourage educational institutions such as universities and training centers to provide more information on how to safely invest in crypto assets.
According to https://bravenewcoin.com/
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