The South Korean cryptocurrency exchange Bithumb has officially confirmed the hack and assured affected users that the damage will be fully compensated.
At approximately 00:53 UTC, immediately after the hack, the exchange was forced to suspend transactions and begin transferring all assets to cold wallets, an autonomous ecosystem. Almost immediately, Bithumb announced on Twitter that accepting and withdrawing funds would be blocked due to the theft of more than $30 million worth of crypto assets from exchange wallets and that the stolen cryptocurrency would be refunded to users.
Oddly enough, Bithumb deleted the original message just a few hours later, leaving only a warning about the inappropriateness of deposits. This seemingly random deletion caused great concern among users and led to a period of speculation and confusion. Some began to speculate that the hack was actually an "inside" job. Whale Panda, a popular figure in the crypto community and Twitter commentator, fueled the rumors by suggesting that the hack was staged to avoid paying a similar amount of taxes that the exchange was obliged to pay after an audit.
After days of rumors and uncertainty, the Korea Blockchain Association, which is made up of cryptocurrency marketplaces and startups, issued a press release saying that the heist tarnishes the reputation of exchanges, but noted that “being willing to compensate customers for losses with their own funds is a worthy way to protect users.”
It is still unknown how the hackers were technically able to carry out the attack. Considering the small amount of damage compared to similar hacks, this attack caused more image damage. An investigation is currently underway, which involves the Korean Communications Commission, the Korea Internet and Security Agency (KISA), and the national police.
Although Bithumb has not yet announced information about which crypto assets were stolen and in what volume, many experts are confident that the attackers were targeting the Ripple wallet.
This attack against Bithumb couldn't come at a worse time, given that South Korean regulators and cryptocurrency platforms remain at loggerheads despite signs that tensions are beginning to ease.. South Korea only recently abandoned plans to impose a ban on digital currency trading after clearing Bithumb and rival Upbit of suspicions of major violations and conducting an audit.
Meanwhile, traders continue to win back this news, as evidenced by trading data and analyst comments.
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