Any hacking of the cryptocurrency exchange negatively affects the value of the cryptocurrency. Hackers conduct attacks not only to steal money. Many hacks are carried out to reduce the rate of cryptocurrency. In the end, inexperienced market players (who now make up the majority) start selling Bitcoins quickly when they hear bad news.
The likelihood of such hacks will only grow with the development of the market and fierce competition on it. Bitcoins and tokens can disappear even from the largest and seemingly secure exchanges.
Historically, Bitcoin theft has been documented repeatedly. Bitcoin exchanges closed, taking with them the funds of their customers.
A Wired study found that 45 percent of bitcoin exchanges eventually close.
1. Hacking Mt. Gox
Date Hacking: June 19, 2011
Stolen Amount: 2,609 BTC ($ 8.75 million)
The first major hack and theft of bitcoins took place on the Mt. Gox.
The hacker managed to hack an audit account with administrative rights. As a result of phishing, he took possession of the administrative account, stole the private keys of the hot wallet from the wallet.dat file, changed the BTC price by 1 cent, received the Mt.Gox user accounts, created sell orders and bought 2643 BTC at an artificially created price for the money of customers.
The hacker used the exchange software to sell all Bitcoins nominally, creating a massive purchase order at any price. Within minutes, the price returned to its correct user value. Accounts with an equivalent of more than $ 8.75 million were affected.
2. Bitomat
Date Hacking: July 2011
Stolen Amount: 17,000 BTC
Once, due to an accidental wallet freezing during a server reboot, the exchange lost the keys to all BTC wallets, which led to a loss of 17 to BTC.
In a nutshell, Bitomat used Amazon Web Services Elastic Cloud Computing to host virtual machines; AWS warning states that if an instance is disabled, all stored data may be permanently lost. It turned out that Bitomat stores backups and the current state of its wallet on the EC2 virtual machine, so, perhaps, they had little chance of returning old funds from wallets.
3. Bitcoin7
Date Hacked: October 6, 2011
Stolen Amount: 11,000 BTC
On October 6, Bitcoin7 posted a message on its website informing users that hackers had attacked the exchange. Hackers hacked Bitcoin7 servers and got full access to the main BTC repository and 2 of 3 backup wallets.
Today, the Bitcoin7 domain offers a fraudulent BTC multiplication service. Maybe still obsessed with hackers?
4. Again Mt.Gox
Date Hacked: October 2011
Stolen Amount: 2609 BTC
The failure of Mt.Gox gained momentum in October 2011. The exchange lost another 2609 BTC due to a programming error. Simply put, Mt Gox accidentally created transactions that can never be redeemed.
5. MyBitcoin
Date Hacking: August 2011
Stolen Amount: 78,000 BTC
In August 2011, the MyBitcoin exchange announced that it was hacked. This led to its closure and payment of 49% on customer deposits. The exchange left over 78,000 bitcoins (equivalent to approximately $ 800,000 at the time) unaccounted for.
6. Linode
Date Hacking: March 2012
Stolen Amount: 3000 BTC + 43000
On March 1, Linode web hosting was hacked, leading to the theft of 3,000 BTC from Slush and 43,000 BTC from Bitcoinica. At this point, security became the main concern of the BTC community. Although people wanted to carry out their economic activities in cryptocurrency, they were concerned about the security of their money.
7. Bitcoinica
Date Hacking: August 2012
Stolen Amount: 18,457 BTC
Theft with Linode at 43,000 BTC was not enough, and another 18,457 BTC was stolen from Bitcoinica's reserves. CEO Zhou Tong was barely able to prevent the loss of another 30,000. The site was immediately closed for security reasons.
Vitalik Buterin, while a writer and co-founder of Bitcoin Magazine, wrote:
“Unfortunately, given the financial stress in which Bitcoinica was already after the Linode theft two months ago, even this smaller loss turned out to be the straw that broke the back of the camel.”
And Vitalik was right, read the diagram below.
8. Bitcoinica Ponzi Pyramid
Date Hacking: August 2012
Stolen Amount: 40,000 BTC
In early August 2012, a lawsuit was filed in a San Francisco court against Bitcoinica, the Bitcoin trading exchange, in the amount of about $ 460,000.
In 2012, the Bitcoinica exchange was subjected to a hacker attack three times, which led to accusations that they neglected the safety of customers' money in this place and deceived them in withdrawal requests.
At the end of August 2012, the owner closed an operation called “Savings and Trust in Bitcoins”, leaving about $ 5.6 million in bitcoin-based debts; this led to claims that the operation was a Ponzi scheme. In September 2012, the US Securities and Exchange Commission launched an investigation into this case.
9. BTC-e
Date Hacking: July 2012
Stolen Amount: 4,500 BTC
Here is the first proven story when exchange operators become greedy and cash in on money that does not belong to them.
Alexander Vinnik, a BTC-e operator, was arrested mainly for money laundering, but also for hacking computers. He was one of the employees who carried out DDoS attacks, stole API keys, initiated Liberty Reserve deposits and introduced large amounts of dollars into the system that were quickly sold for BTC.
BTC-e.com was considered the gold standard for reliability.
10. Bitfloor
Date Hacked: September 2012
Stolen Amount: 24,000 BTC
In September 2012, Bitfloor also announced that it was hacked by stealing 24,000 bitcoins (worth about $ 250,000). As a result, Bitfloor paused. In the same month, Bitfloor resumed work; The founder of the exchange said that he reported the theft to the FBI and that he plans to pay money to the victims, although the maturities are unclear.
