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Bitcoin Price Slashed by 15% – Another Exchange Hacked

Bitcoin Price Slashed

Bitcoin Price came tumbling down as news spread that one of the large digital currency exchange has been hacked.

Hongkong based exchange Bitfinex had halted its operations after they found a security breach. They went offline and paused all their withdrawals and deposits.

Their website declared a statement
“Today we discovered a security breach that requires us to halt all trading on Bitfinex, as well as halt all digital token deposits to and withdrawals from Bitfinex.”

It further said
“We are investigating the breach to determine what happened, but we know that some of our users have had their bitcoins stolen. We are undertaking a review to determine which users have been affected by the breach. While we conduct this initial investigation and secure our environment, will be taken down and the maintenance page will be left up.
The theft is being reported to — and we are co-operating with — law enforcement.”

This news has sent a very strong negative signal with respect to security of digital currency.

Bitfinex is one of the largest exchange based in Hongkong dealing in several digital currencies. Past 30 days, estimated trading that occurred through Bitfinex is approx 600,000 BTC. Bitcoinity data reveals.
Bitfinex has further reported in its statement that only Bitcoin accounts have been affected by this hacking. Accounts pertaining to other digital currencies remain unaffected. Bitfinex is now accounting for the damages done. They might settle down some of the active trading positions at the time when this security breach was reported.

“As we account for individualized customer losses, we may need to settle open margin positions, associated financing, and/or collateral affected by the breach,” the statement from Bitfinex read. “Any settlements will be at the current market prices as of 18:00 UTC.”

Bitfinex said that it will look at various options to address customer losses later in the investigation, according to the statement.
Bitfinex had suffered some losses earlier in May when one of its hot wallet, containing Bitcoin funds were targeted. Similar losses were reported by other exchanges like ShapeShift and Gatecoin due to security breach at their end.

Bitcoin Price

Bitcoin Price which opened at $607.37, fell to $530.

Bitcoin Price
Bitcoin Price Slashed

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The trend has already been on the downside with Bitcoin prices sliding down from $675 to $613 last week. Such incidents of security breach will once again raise questions whether digital currency is a safe investment or not. World has still not forgotten the biggest breach in the history of Bitcoins when Tokyo based Bitcoin Exchange, Mt Gox, the biggest bitcoin exchange of that time, was hacked in Feb 2014 and prices came down drastically. Mt Gox used to handle 70% of all Bitcoin transactions that time. When this security breach occurred at Mr Gox, they reported 850,000 bitcoins belonging to their customers were missing and likely to be stolen. It was valued at $450 million at that time.

Bitcoins have been most successful digital currency so far. Due to its unique properties, it has gained popularity and value in a very short term. It is deemed to be first global digital currency. However such kinds of unfortunate incidents will lead to a wave of uncertainty adversely affecting the cryptocurrency .

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