Crypto platform suffers $41m bitcoin hack

Cryptocurrency platform Binance has confirmed that hackers have stolen 7,000 bitcoin with a value of more than $41 million.

In a statement posted early this morning, the Hong Kong based firm - which runs one of the world’s largest cryptocurrency exchanges - said cybercriminals had used phishing, viruses and other attacks to carry out the hack and obtain a “large number” of user API keys, 2FA codes and other information.

Zhao Chanpeng, Binance’s chief executive, said that deposits and withdrawals on the platform would remain suspended for the next week as the company conducts a thorough security review. He said the hack impacted the BTC (Bitcoin) hot wallets only - which contained about two per cent of total BTC holdings - while all of other wallets were secure.

The statement read: “The hackers had the patience to wait, and execute well-orchestrated actions through multiple seemingly independent accounts at the most opportune time. The transaction is structured in a way that passed our existing security checks.

“It was unfortunate that we were not able to block this withdrawal before it was executed. Once executed, the withdrawal triggered various alarms in our system. We stopped all withdrawals immediately after that.”

The hack, which is the latest in a string of high profile thefts from cryptocurrency exchanges, will raise concerns around the security of digital assets as hackers becoming increasingly sophisticated in their methods.

In an update posted to Twitter, Zhao Chanpeng said the company would cover the loss from its Secure Asset Fund for Users. He added: “We are hurt, but not broke. We are working hard to resolve the issue, so that everyone can deposit and withdrawal again. Will take some time.”

Commenting on the incident, Ilia Kolochenko, founder and chief executive of web security company ImmuniWeb, said: “Technical details of the breach still remain obscure and it would be premature to make any conclusions at this point of time.

However, he warned that many cryptocurrency businesses “underestimate or ignore digital risks and allocate scant resources for cybersecurity”, adding: “To bring certainty to the cryptocurrency markets clear regulatory standards are required - even if they are not a silver bullet, they greatly reduce both the number and average volume of credit cards theft."

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