Coinrail hack sends bitcoin price tumbling
Korean cryptocurrency exchange Coinrail has lost 30 percent of its coins following a hack, leaving investor confidence in bitcoin, among others, shaken
On June 10, the value of bitcoin fell by roughly 10 percent after Coinrail, a Korean cryptocurrency exchange, was hacked. Hackers were able to take around 30 percent of the exchange’s coins in what is the latest cyberattack on a crypto-exchange platform.
On its website, Coinrail confirmed 70 percent of its coins and tokens are safely stored in a ‘cold wallet’, an offline data storage unit unable to be accessed by hackers via the internet. Coinrail also said the value of stolen coins is still being determined, but confirmed two thirds of the loss is covered through freezing and recalling, while the status of the remaining third is being probed by investigators, relevant exchanges and coin developers.
Being one of the smaller exchanges in the market, Coinrail was not legally required to have information security management systems in place, as the legislation only applies to sites attracting in excess of one million daily visitors.
Although bitcoins were not the only cryptocurrency taken in the breach, investors were rattled by the security of their crypto-assets, causing bitcoin to lose around $500 in value
As a consequence, the platform was perhaps more vulnerable to the data breach than bigger players would have been. Additionally, Coinrail was not a member of the group of South Korean exchanges that jointly implemented stricter self-regulation and security measures in January.
Although bitcoins were not the only cryptocurrency taken in the breach, investors were rattled by the security of their crypto-assets, causing bitcoin to lose around $500 in value.
The hack is the latest in a string of attacks on cryptocurrency exchanges. The most famous hack took place in 2014, when Mt Gox, the largest bitcoin exchange of its time, went bankrupt after $460m worth of bitcoin was stolen in a cyberattack.
A few years later, Bitfinex was also hacked, losing $72m in crypto-coins. Most recently, another South Korean exchange, Youbit, went bankrupt in December after multiple hacks.