Bitfinex Hack: US Regulation ‘Prevented Cold Storage Use’
Following the hack of exchange Bitfinex and the theft of almost 120,000 BTC ($60 million), suggestions are surfacing that regulation prevented its funds from being placed in cold storage wallets. Fingers Point at BitGo, Regulators. As the investigation into the sequence of events and their cause continues, blame is being shifted between Bitfinex, its....
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Some notable experts claim that this regulatory framework presented by the CFTC may have prevented Bitfinex from using cold storage. On June 2, the U.S. Commodity Futures Trading Commission (CFTC) fined Bitfinex US$75,000 for handling illegal off-exchange financial retail commodity transactions without registering as a futures commission merchant. The CFTC – alongside other regulators – required the exchange to deliver the digital currency directly to their users, instead of holding the private keys controlling the traded coins. The official order stated that Bitfinex “did not actually....
Nearly two weeks after losing more than $60m in customer funds, Bitfinex reports it has not yet identified how the theft was carried out. In a statement released earlier today, the exchange reported it had hired Ledger Labs, a blockchain consultancy previously contracted by ShapeShift following its own cybersecurity problems, to both investigate the theft as well as perform a balance sheet audit. Bitfinex further said that it is "reassessing" storage options in light of the hack. The incident would force the exchange to impose a 36% haircut on customer holdings, a move that....
Bitfinex, one of the biggest bitcoin exchanges, went down for the second time within a day today at 10AM London time for four hours following “network issues” within Bitfinex’s datacentres according to Zane Tackett, Director of Community and Product Development. The unexpected suspension of trading sent price crashing last night to $700 from almost $780. Bitcoin’s price continued to fall as low as $650 today before slightly recovering. In responding to our question of whether this was a hack, bitfinex stated in a public tweet “No, not in any way.” In response to our question on whether....
The Bitfinex hack was an unfortunate time for Bitcoin users as the exchange had lost roughly $70 million USD in customer funds. Thus, the topic of security is on everyone’s lips as two hardware wallet manufacturers — Trezor and Ledger — are claiming that the hack could have been prevented with one affordable device. Trezor Wants to Stop Bitcoin Exchange....
A recent blog post from Xapo called “What happens if Xapo gets hacked?” the company discusses the unfortunate Bitfinex heist that took place on August 2, 2016. Xapo says that if they were compromised the company would cover the losses from its own reserve. This is a glaring difference to the many exchanges that failed to reimburse their customers. Cold....