The UpBit Case: How Crypto Hacks Are Making The Industry Stronger
With Leading Exchanges like UpBit being hacked, some people are thinking that another system of exchange might be needed in these dire times.
The popular South Korean cryptocurrency exchange, UpBit has suffered a huge blow to its operations, given the fact that 342,000 ETH were transferred to a single crypto address. The amount of Ethereum tokens stolen is worth around $50m. Given this massive upset, UpBit re-actively transferred all its crypto assets to “cold” storage, and immediately seized all its operations regarding deposits and withdrawals until the issue was resolved. They’ve given an estimation that operations will be resumed in approximately the next two weeks.
As a sign of good customer service, and to keep their user base from tearing their hair off UpBit has also stated that no investor funds have been lost, as UpBit will be recovering the missing 342K in ETH tokens from their vaults.
Changelly’s CEO Eric Benz expressed confidence that the mutual cooperation of companies in the crypto sphere, aimed at solving the issue of hacking and security, is already borne fruit:
“We at Changelly team will be working closely with Upbit and other exchanges in order to stop any hacked funds from passing through our platform.”
Eric Benz, CEO at Cahngelly
When talking to Coinfunda, Eric also mentioned that “…Whenever there is a ‘crypto hack,’ it is not the fault of the blockchain, Bitcoin or any cryptocurrency per se. The fault lies rather in the security, infrastructure, and controls of the wallet or exchange…”
Eric shows that this does not just affect UpBit, but affects us all, and given this turn of events, we must stand in solidarity with the exchange and help in any way we can.
Thing is though, cyber-attacks are becoming more and more frequent, with hackers specifically targeting traditional/custodial exchanges. This theft marks the 8th time thefts are being made by hackers in the crypto sphere, with The Block concluding that the total amount of Crypto stolen in 2019 amassing to around $1.44b. These include companies like VinDAX, Bitpoint, Bithumb, Binance, Cryptopia, and Bitrue. Given who they’re targeting in all this, it might make sense that changing the system to an instant/non-custodial exchange would be the way to go. Given how it is laid out, instant/non-custodial exchanges work faster, more efficient, and is generally much safer from these attacks given that they do not hold any assets in custody. This might also give users certain peace of mind when swapping or buying crypto.
Nevertheless, this is where the crypto community needs to stand together, and help each other out, in our shared interest in crypto mass adoption, we must put our minds together and figure out how to avoid this happening again, and later in the coming year.