5 Times When Bitcoins Were Hacked and Stolen

5 Times When Bitcoins Were Hacked and Stolen

While bitcoin has been deemed as the safest way to transfer money, there have been times when bitcoins were stolen.

I’m not talking about stealing 1 or 2 bitcoins but several thousands of them.

1Mt. Gox (844,000 BTC)
2Bitfinex (120,000 BTC)
3BitFloor (24,000 BTC)
4Bitstamp (19,000 BTC)
5Binance (7000 BTC)

5 Times When Bitcoins Were Stolen and Hacked

Mt. Gox (844,000 BTC)

Mt. Gox was a bitcoin exchange based in Japan.

It handled more than 70% of all the bitcoin transactions at its prime.

744,000 BTC were stolen from customer wallets and about 100,000 BTC were stolen from the company’s funds.

Mt. Gox experienced the biggest hack in bitcoins to date.

How was Mt. Gox hacked ?

Mt. Gox was hacked for the first time in 2011 and according to inside sources, hackers were slowly skimming bitcoins away from the company’s hot wallet since then.

Investigative agencies revealed that the hack happened due to the low-security measures and the company’s mismanagement.

In February 2014, the company seized all its operations and filed for bankruptcy in Japan and the US.

A month later, the company also recovered 200,000 BTC from its old unused digital wallets.

However, these bitcoins were reserved for creditors by bankruptcy protection.

Bitfinex (120,000 BTC)

Bitfinex experienced the second biggest hack after Mt. Gox.

It is a cryptocurrency exchange platform headquartered in Hong Kong.

119,756 bitcoins were stolen from Bitfinex users.

Hackers exploited a vulnerability in the multi-signature wallet architecture of Bitfinex and BitGo.

Then Bitfinex compensated all its users by giving BFX tokens which were redeemable in USD.

Even after such a massive hack, it is incredible that Bitfinex is still operational.

BitFloor (24,000 BTC)

Bitfloor was a bitcoin trading and exchange platform based in NY, USA.

Bitfloor was hacked in 2012 and about 24,000 bitcoins were stolen.

The company stored all its funds in a hot wallet and hackers gained access to the unencrypted private keys which were also kept online.

After the hack, Bitfloor promised to refund all its customers but the company’s bank terminated any further businesses and all the users lost their funds forever.

Bitstamp (19,000 BTC)

Bitstamp is a cryptocurrency exchange based in Luxembourg.

On 4 January 2015, 19000 BTC were stolen from Bitstamp’s hot wallet.

According to reports, an anonymous hacker sent malware in the email to all the exchange’s employees and a manager opened the mail on the company’s servers.

This gave the hacker the access he needed. He then managed to steal 19000 bitcoins.

Bitstamp’s officials quickly responded and said that they only kept minimal bitcoins in their hot wallets.

Bitstamp soon recovered from this blow and adopted major security measures henceforth.

It is still operational to date.

Binance (7,000 BTC)

Binance founded in 2017 is one of the most popular cryptocurrency exchanges in the world.

In May 2019, Binance reported that hackers were able to gain access to a large number of user accounts using a number of techniques including phishing, malware, viruses, and other techniques.

They managed to swoop away 7000 bitcoin in one transaction (i.e 2% of all Binance holdings). They quickly repaid all their affected users.

Some Noteworthy Mentions :

  • ShapeShift (469 btc)
  • BTC-e (4500 btc)
  • Bitcoinica (40,000 btc)

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