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Hackers steal $65 million of Bitcoins on Bitfinex exchange

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August 3, 2016

The Bitfinex Bitcoin Exchange (BBE) in Hong Kong has been hit by professional hackers that stole about US $65 million in the 'supposedly-safe' crypto currency. Some say it may have been an inside job.

Bitfinex replaced its site's homepage with a statement on the hack attack but didn't detail losses or the means by which the Bitcoins were stolen.

The site's homepage said: 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. 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, bitfinex.com 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.

Withdrawal limits in place at Bitfinex and many other exchanges were mysteriously bypassed. Community and product development director Zane Tackett said about 119,756 bitcoins were stolen.

News of the successful hacking attempt sent the value of Bitcoin tumbling by some 20 percent to about US $540. Tackett disclosed the number of stolen bitcoins to Bitfinex and has been fielding scores of inquiries. He says he will post updates about the hack tomorrow.

Bitfinex say no US currency was stolen, and could not confirm details on possible reimbursement for affected customers, however.

Bitfinex's security firm Bitgo says it has not found any evidence of a security breach of its servers during its investigation.

Use of that security company meant customer bitcoin wallets were separated and so limited the scale of the hack.

It followed the US $50 million security breach of Etherem which was reversed after a hard fork was enacted.

Police are investigating. News of the hack broke at around the time Hong Kong was dealing with Typhoon Naida, a storm that saw the territory invoke emergency management plans that emptied the streets and closed most businesses.

Some are speculating that the hack somehow took advantage of the weather. The security breach brought back not-too-distant memories of Mt.Gox, a leading Bitcoin exchange that stopped investors from withdrawing money in 2014, blaming the disruption on technical issues and cyber attacks. Mt.Gox later filed for bankruptcy.

There are some that may not know this, but Bitfinex is one of the largest Bitcoin exchanges in the world. It had the highest volume of dollar-denominated transactions over the past thirty days, according to the website Bitcoin Charts.

Source: Bitfinex.

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