Cryptopia Hacker Moves Stolen Crypto to Binance; Community Alerts CZ and Funds Are Frozen
It is clear that hackers gave themselves a place to stay in the cryptocurrency industry, which was only made more evident by a recent security breach that happened over the last few days.
Cryptopia, a leading exchange in New Zealand, announced a breach that ended in a major theft on January 14th. However, unlike the unfortunate tale that many other exchanges succumb to, that is not the end of the story.
The official statement notes that Cryptopia has placed itself into a maintenance mode, helping them to protect their accounts until the regulatory authorities of New Zealand provide other details.
Both the High Tech Crimes Unit and the local police are pursuing investigative efforts, though they have commented that “a significant value of cryptocurrency may be involved.” At this point, the actual amount has not been released, and no substantial details have been provided. Still, that has not stopped local news portal Radionz from reporting that the loss is close to $3.6 million.
A Twitter user, ShaftedTangu, seems to know where these digital assets are going. On the posts, the user said,
— 🐒🐵I Dream Of Alts🐵🐒 (@ShaftedTangu) January 16, 2019
Through a string of additional tweets, the user continued to track the funds, as he mentioned wallet address 0x9007a0421145b06a0345d55a8c0f0327f62a2224.
In another tweet, he claimed, “Currently the 0x900 wallet contains around $10 mil USD of tokens, large amounts are $PRL $2mil, $CENNZ $1.168 mil, $Denacoin $2.73 mil, $MSP $0.99 mil” Luckily, just under four hours after the original tweet, CZ Binance replied.
The reply said,
Just checked, we were able to freeze some of the funds. I don't understand why the hackers keep sending to Binance. Social media will be pretty fast to report it, and we will freeze it. It's a high risk maneuver for them. https://t.co/i0PeahLzic
— CZ Binance (@cz_binance) January 16, 2019
With such a nonchalant type of reply, it is quite a victory for Cryptopia and Binance that the funds could be frozen at all.
However, the victory has not been won yet, considering there is no indication of exactly who performed the hack in the first place. Cryptopia has remained silent, though they posted to their own Twitter profile, saying,
“We cannot comment as this matter is now in the hands of the appropriate authorities. We will update you as soon as we can.”
As a result of these issues, Zhao posted that users should keep their holdings on exchanges, rather than a hardware wallet. However, his post caused an onslaught of negative replies, with some saying that his post implied that self-storage is substantially riskier than storing on a seemingly “reputable” exchange. Zhao later retracted, saying that he was not advising investors to store funds on exchanges.
In the first half of 2018 last year, there was over $731 million lost in thefts involving exchange hacks. However, none have reached the severity experienced by the 2014 Mt. Gox hack.