BITPoint crypto exchange loses $32 million to hackers
The money was taken from the exchange’s hot wallet
Another cryptocurrency exchange has found itself the victim of hackers. Japan’s BITPoint exchange reportedly lost $32 million from its hot wallet when thieves broke in and made off with the funds. The exchange realized something was wrong when it tried to send a payment using Ripple’s XRP and was denied.
The hot wallet reportedly held Bitcoin (BTC), Bitcoin Cash (BCH), Ether (ETH), Litecoin (LTC) and XRP. As soon as the problem was detected – which is different than saying the problem was detected when it happened, BITPoint moved in to help ensure no further damage happened. It explained in a statement to customers, “To prevent any harm to customer assets, we will handle this responsibly, for example in terms of compensation from Bitpoint. We regret to inform you we terminate all our services immediately due to Securities Commission Malaysia didn’t permit us to operate as Digital Asset Exchange. We start to return all our existing customer asset. Please note, we are keeping customer asset safely.”
Unfortunately, the funds included deposits held for clients. Around $23 million of the missing money was client funds, while about $9.2 million belonged to the exchange. Fortunately, the company has already been able to find the majority of the stolen funds. According to a subsequent report, it has found around $3.2 million, which was located on overseas exchanges that use a trading system provided by BITPoint.
The exchange has already been warned about not keeping better separation between its funds and those of its customers. However, it apparently didn’t heed that warning as much as it should have.