Crypto Consulting Group

blog

Blockchain and Cryptocurrency News


CCG Blog


South Koreas Largest Bitcoin Exchange to Compensate Users After Hack

 

South Koreas largest bitcoin and ether exchange, Bithumb will be compensating customers who lost funds due to a hack in the companies data systems.

As many as 30,000 customers of Bithumb were impacted according to a report from regional news service, Yonhap Monday. The source of the data leak is believed to have been from an employee's computer, leading to the draining of funds from existing users accounts.

Although the exact amount stolen has not been unveiled, one local user claimed to have 10 million won, worth roughly $8,700, taken from their account.

According to data from CoinMarketCap, Bithumb is currently the fourth-largest bitcoin exchange and largest ether exchange by volume. Bithumb accounts for about 3% of the global Bitcoin market and 13.5% of the global ether market.

Bithumb said in a blog post published earlier today that it is providing 100,000 Korean won – worth about $86.50 at press time – to each affected customer.

The fact that Bithumb is compensating its' affected users comes just a week after GDAX announced they to would compensate its' users for lost funds in their recent "flash crash". This is a big step for exchanges and the crypto-ecosystem as a whole. Partly because a few years ago if something like this were to happen you were just out of luck. Most exchanges now are licensed and insured which offers more protection to the users.

This was not the first time an exchange was hacked and it wont be the last. Even though the product these exchanges provide is decentralized and secure in nature, the exchanges are not. They still hold data in centralized servers, which are vulnerable to hacking as you've just read. This is why it's imperative you use a cold wallet, or wallet maintained by you and only you. When you hold your coins on an exchange, someone else is holding your keys and passwords. You can read more about different variations of wallet here.