The number of exchanges hacked this year may surprise you

The number of exchanges hacked this year may surprise you

There is a reason why people call bitcoin “Gold 2.0,” which has become the target of hackers worldwide with one purpose – to steal bitcoin for profit. Bitcoin holds many properties which makes it valuable, with the global market capitalization growing to a current value of $8 billion USD.

Across the world there are over 170 bitcoin exchanges, with new exchanges popping up constantly. For exchangers, the business model is clear. Making money from exchanging fiat-to-bitcoin and bitcoin-to-fiat is there, the demand has risen every year as bitcoin grows and becomes more popular.

With the price of bitcoin being high enough to raise the stakes, the wolves have exited their dens of information hacks which they sell on the dark web, to just going straight to the gift horse and stealing bitcoin directly from exchanges.

To be completely clear, bitcoin itself, the protocol, has never been hacked. When speaking of “bitcoin hacks” the reference is about bitcoin exchanges (and sometimes wallets too!), that have been hacked. Exchanges and wallets are third-party platforms built on top of the bitcoin protocol. Picture your bank, which stores dollars. If the bank is hacked, you don’t say the dollar has been “hacked,” you say the bank which stored the dollar has been hacked. It’s the same premise with bitcoin exchanges.

Hacked exchanges this year

This is a list of bitcoin exchanges that have been hacked so far this year up to now. Hacks could be anything from platform-wide hacks where multiple accounts are hacked, or one person being hacked on the exchange due to platform-targeting, either due to an exploit or poor security practice either on the exchange’s side and/or the user’s side.

August 2016 – Bitfinex
Starting with the most recent and one of the biggest this year, Bitfinex was hacked to the tune of $61.8 million dollars. The investigation is still ongoing.

July 2016 – Kraken
Bitcoin exchange Kraken has been targeted by hackers, where some user accounts have been compromised and funds stolen. One user reported losing about $285 on the exchange from their account being hacked.

July 2016 – itBit
Users on the exchange were targeted, with one user nearly losing 18 BTC. Although accounts were compromised, no funds were stolen that we are aware of.

May 2016: Gatecoin
A hot wallet breach on the exchange may be the biggest total loss of the year, estimated to be $2 million USD stolen from the exchange.

May 2016: SimpleFX
The SimpleFX exchange email system was hacked, not the trading platform, with user email addresses being stolen. It was never clear whether the exchange used their own mail system or a third-party, but emails were spoofed with malicious messages sent to exchange users.

April 2016: Shapeshift
Alternative currency platform Shapeshift suffered a large-scale hack, where the attackers were able to walk away with $230,000 in total.

April 2016: Yaykuy
Chilean bitcoin exchange Yaykuy, based in Santiago, was hacked and taken offline. The exchange was working to fix any security holes, but it doesn’t appear they ever came back online.

March 2016: BitQuick
The exchange shut down after a security breach, where customer names, phone numbers, and emails were stolen in the hack. No funds were taken that we are aware of.

March 2016: Cointrader
Canadian bitcoin exchange Cointrader.net was hacked, where all data including social media accounts were compromised and shut down.

January 2016: Cryptsy
Troubled bitcoin and altcoin exchange Cryptsy made an announcement in January stating that they were hacked, losing somewhere along the lines of 13,000 bitcoin. The exchange shut down and has never re-opened.

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david@bitcoin.com'
David is a writer, researcher, and developer who is passionate about bitcoin and blockchain. He writes for Bitcoin.com, Blockchain.com, and is the founder of Bitcoinx.io (which was acquired by Bitcoin.com). David previously used to write and curate for Myspace and has worked in the fintech and payments space for over 15 years.