Crypto Exchange Bithumb Suffers $13M Hack, Inside Job Suspected

Crime, News | April 1, 2019 By:

South Korean cryptocurrency exchange Bithumb has reportedly lost around $13 million worth of cryptocurrency EOS in a security breach.

In an online post, Bithumb said that it detected some “abnormal withdrawal” of EOS at around 10:15 pm on March 29. According to the exchange, more than 3 million EOS tokens had been transferred from a hot wallet. However, the exchange confirmed that all the stolen funds were taken from a company-owned wallet and that all user funds are safe.

“All the spilled cryptocurrency is owned by company, and all the member’s asset is under the protection of cold wallet,” Bithumb said, adding that it has secured all the cryptocurrency from the detection time with a cold wallet and checked them by blocking deposit and withdrawal service.

Bithumb admitted that it was prioritizing security from external sources while ignoring any internal threats. After conducting an internal inspection, the exchange said that the incident is an “accident involving insiders.”

“Based on the facts, we are conducting intensive investigations with KISA, Cyber Police Agency and security companies,” Bithumb said. “At the same time, we are working with major exchanges and foundations and expect to recover the loss of the cryptocurrency equivalent.”

This is the third time Bithumb was hacked in the past two years. In July 2017, the exchange lost more than $7 million in bitcoin and ethereum in a security beach, during which an unknown attacker hacked the personal computer of a Bithumb employee. The second incident took place in June 2018, in which 35,000,000,000 KRW ($31M USD) worth of cryptocurrencies have been stolen.