http://www.pymnts.com/news/bitcoin-tracker/2016/bitcoin-exchange-65m-hack-bitcoin-price-drop/
After an early summer with solid gains, Bitcoin’s price has been plummeting following the hack of Bitfinex – a Hong Kong-based bitcoin exchange.
According to sources within Bitfinex, all trading and deposits have been put on hold while it investigates the full extent of the hacking and theft which have allegedly caused $65 million worth of the virtual currency to virtually disappear into thin air.
Bitcoin’s trading price dropped by about 20 percent in trading on international exchanges – though as of mid-day in Hong Kong, prices had recovered by about half.
Zane Tackett, Bitfinex’s director of community and product development, did not immediately respond to requests for comment from the New York Times. In a Reddit posting he confirmed that 119,756 Bitcoins had been stolen.
The pre-hack value of those coins was around $72 million – but the resultant slump in price has pushed down the value of the bounty. The exchange has publicly confirmed that it will settle hacked accounts at pre-hack prices.
“As we account for individualized customer losses, we may need to settle open margin positions, associated financing, and/or collateral affected by the breach,” Bitfinex said in the post. It added that customers’ losses would be addressed later.
This is neither the first, nor the biggest, hack of bitcoin in recent memory. Tokyo-based Mt. Gox lost several hundred thousand bitcoin at the top of its value (translating into over $100 million lost) and in June, $50 million of Ether – a competing digital currency – was also boosted by hackers. Digital currency skeptics note that these frequent high dollar breaches signal some underlying security problems that will likely hamper bitcoin’s evolving into mainstream currency status.
After an early summer with solid gains, Bitcoin’s price has been plummeting following the hack of Bitfinex – a Hong Kong-based bitcoin exchange.
According to sources within Bitfinex, all trading and deposits have been put on hold while it investigates the full extent of the hacking and theft which have allegedly caused $65 million worth of the virtual currency to virtually disappear into thin air.
Bitcoin’s trading price dropped by about 20 percent in trading on international exchanges – though as of mid-day in Hong Kong, prices had recovered by about half.
Zane Tackett, Bitfinex’s director of community and product development, did not immediately respond to requests for comment from the New York Times. In a Reddit posting he confirmed that 119,756 Bitcoins had been stolen.
The pre-hack value of those coins was around $72 million – but the resultant slump in price has pushed down the value of the bounty. The exchange has publicly confirmed that it will settle hacked accounts at pre-hack prices.
“As we account for individualized customer losses, we may need to settle open margin positions, associated financing, and/or collateral affected by the breach,” Bitfinex said in the post. It added that customers’ losses would be addressed later.
This is neither the first, nor the biggest, hack of bitcoin in recent memory. Tokyo-based Mt. Gox lost several hundred thousand bitcoin at the top of its value (translating into over $100 million lost) and in June, $50 million of Ether – a competing digital currency – was also boosted by hackers. Digital currency skeptics note that these frequent high dollar breaches signal some underlying security problems that will likely hamper bitcoin’s evolving into mainstream currency status.
