WHAT IS GOING TO HAPPEN TO THE VICTIMS OF BITMART HACK?
On Saturday, 4th December 2021, BitMart, the multi- billion dollar company experienced a tragedy in the form of “a large- scale security breach” of two of its hottest wallets which resulted in the hackers withdrawing about $150 million worth of assets with speculations of it being more than that. In response to this breach, BitMart shutdown several systems to prevent more damage and initiated an in depth investigation of why the hack happened, how much loss had occurred, what systems were affected and how to go about damage control.
Although BitMart insists that the hackers withdrew roughly $150 million in assets, forensics report from renowned blockchain security and data analytics firm Peckshield says otherwise. Peckshield claims that the loss is estimated to be around $200 million. CNBC has reached out to Bitmart to explain the difference in reports but has not received a feedback from the company till this very moment. However, BitMart released a statement last monday reassuring the victims of reimbursement of their losses using its own money. Fortunately, processes have already been put in place to ensure an effective reimbursement.
In the meantime, the trading company has suspended customer withdrawals until further notice as it continues its thorough investigations and security reviews and has promised to “maintain transparency” during this process. With the help of cybersecurity specialists and law enforcement agencies as well as other cryptocurrency trading platforms, BitMart has made it its mission to strengthen their defenses against any and all future attacks and to get the hackers responsible for this attack.
Additionally, the company has gone ahead to continue to reassure its customers that the systems affected “carry a small percentage of assets on BitMart and all of our other wallets are secure and unharmed” despite the fact that the systems affected were the ones storing Ethereum and one Binance Smart Chains (BSC)tokens.
These storage systems were “hot wallets” which would give more logic as to why they were easier to attack. As some of you may already know, Cryptocurrencies can be stored in different ways “hot”, “cold” or a combination of both. Hot wallets, however, are more preferred by customers because of its connection to the internet and relatively easier access of owners to their coins for spending or trading. Unfortunately, this comes with less security and higher risks to hackers unlike the cold wallets.
