Security breaches to online cryptocurrency exchange platforms is not new. Infact, many hackers specifically devote their time, energy and resources in targeting exchange with big assets to attack and this act calls for improved awareness and cryptographic innovations that would protect blockchain platforms from such malicious attacks. As encrypted as the blockchain system is, it has experience series of attacks in recent times of which the hacking of DragonEx is the latest.
Update on DragonEx Hacking
The platform offers cryptocurrency exchange services to customers targeting the Singaporean and Eastern Asia market. Trading was actively ongoing as at Sunday when the platform made an announcement on its official Telegram channel on Monday, stating that, on Sunday, March 24, it had experienced a cyberattack that saw cryptocurrency funds owned by users and the exchange “transferred and stolen.” As at the time of writing this article, no price value has been placed on the stolen assets, some of which the site confirmed to have retrieved back. In response to the attack, the company is coordinating with several agencies such as the police and other judicial administrations in Estonia, Thailand, Singapore and Hong Kong in investigating the hack.
The Call for New Security
Security breaches such as this suffered by DragonEx is and continues to be a major source of worry to stakeholders in the Cryptosphere. This worry thereby calls for better security on trading platforms that goes beyond multiple verification systems required of customers. Since the major threat emanates from external sources, there is a need to adopt a better cryptographic security system that further consolidates the anonymous nature of the Blockchain ecosystem.
The hacking carried out on cryptocurrency exchanges takes different forms. The outline below highlights a way to guard against some of these tricks used by hackers:
Preventing Phishing: Caution Employees on how they handle phishing scams. Most hackers use this phishing tricks to gain access into an exchanges database or server and with a single mistaken click by an employee, an irreparable damage might be caused.
Porous Access to Hot wallets: some exchange falls victim of hacking because the hot wallets of investors are too porous to access. Coincheck, a Japan-based currency exchange, admitted it did not secure a hot wallet with multi signature private keys, this oversight cost the exchange a record breaking $500 Million of XEM currency. Hot wallets should be designed to have multiple secure keys to access them.
Although most exchanges are now circumspect in their dealings and tend not to suffer losses as described above, a lot of caution is still required to provide the needed safety to ease the tension and allay the fear of loss through hacking. Cryptocurrency exchanges can start by borrowing the technologies deployed for privacy coin projects such as IP Masking, Coin shuffling and other related privacy rich features that are in line with the business tenets of the exchange. In all, cryptocurrency exchange security is a wake-up call that requires constant and dynamic innovations from all persons of interest in the cryptosphere.