Bitstamp Exchange Lose Bitcoins To Hackers

Bitstamp Exchange Lose Bitcoins To Hackers

Trading at Bitstamp, a European bitcoin exchange, was suspended after one storage wallet was compromised recently. The trading site issued a warning to users against depositing in addresses that were issued previously. It also revealed that only a small number of its customers are kept on their online system. It added that the compromised virtual currency can be recovered through its offline storage reserve.

Nejc Kodric tweeted that majority of the reserves of Bitstamp are in cold storage and remained uncompromised. The site also revealed that its service will be coming back soon.

Bitstamp revealed that around 19,000 bitcoins were stolen from the operational wallet of the company. However, Kodric revealed the virtual currency held by the company before the suspension of operations were safe. Reports of the compromised storage wallet resulted anxiety among many users.

The hack on Bitstamp comes around a year after Mt. Gox closed up after millions of dollars worth of the virtual currency were stolen by hackers. The company folded up after its systems were breached by hackers in 2014. Nearly $450 million were reportedly stolen. Bankruptcy protection was filed by the company, which resulted to an investigation on its closure by US and Japanese authorities.

Following the breach, the value of the virtual currency dropped from its peak of around $1,240. In the face of its volatility a good number of companies have started to support the virtual currency. For the moment, no hacker group claimed responsibility for the breach in the storage of Bitstamp. The suspension of operations by Bitstamp resulted to a decline in the value of the currency in the market.

Kodric revealed that the company maintains around 85 to 90 percent of the funds of its customers in cold storage to reduce the number of bitcoins put at risk to hacker attacks.

Posted by James Fried on Thursday January 08 2015, 3:17 AM EST. Ref: ZD Net. Link. All trademarks acknowledged. Filed under Featured News, Finance. Comments and Trackbacks closed. Follow responses: RSS 2.0