Security Concerns after Two Major Cryptocurrency Exchange IncidentsNovember 25, 2021
As of late, there have been an increasing number of cryptocurrency exchanges coming under attack from hackers, a lot of them being focused on South Korean exchanges in particular.
As a result of these two attacks that occurred on the 19th of December, one of the exchanges in question was forced to file for bankruptcy. This showcases the growing need that exists for more regulation and security in the sector, especially as these types of platforms are becoming more mainstream by the day.
It was a South Korean exchange called Youbit which is operated by the team at Yapian that had to suspend their trading after they realized they were attacked on the 19th of December.
This led to them seeing a fall of 17% in terms of their assets, as reported by the company. The amount of losses has been minimised as a result of cyber insurance and the potential sale of operating rights.
Coinbase is one of the most well-known exchanges in the world and is popular amongst new entrants to the world of cryptocurrency trading. They reported on the 20th of December that there was an ongoing investigation being conducted into both their staff and their contractors after there was a significant sudden spike in the Bitcoin Cash prices.
This price hike reached 33% on the 19th of December, with a further price hike of 41% the following day.
This was not the first time that Youbit had been a target of an attack. It was back in April when they first had a breach, making this the second hack in the same year.
This comes at a time when many of the major cryptocurrency exchanges in South Korea are being targeted, with the security officials placing a lot of their focus on North Korean hackers.
Youbit has allowed their investors to make withdrawals of approximately 75% of their digital token holdings, saying that the remaining balance of these coins could be withdrawn as soon as the process of bankruptcy has been completed.
Currently, they are not sure where the attack originated from, but the massive increase in trading volume of digital currencies like Bitcoin in South Korea in recent times has made them a lucrative target.
Some of the exchanges have been charging premiums of up to 20% more than the standard international rates for those purchasing Bitcoin in the region, which showcases how eager investors are to get their hands on it.
There have even been warnings by the South Korean Prime Minister over this hysteria, warning people about potential dangers.
Following the bankruptcy of Youbit, the South Korean authorities are not going to step in at all or taking any countermeasures as they feel that ample warnings were given to investors about the risks associated with using these exchanges.
Featured image via BigStock.
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