Upbit, the South Korean crypto exchange, recently confirmed that it had lost about $50 million worth of Ethereum to hackers. The hack took place on Wednesday, November 27. In its statement, the exchange promised it would recover the funds that were lost. Due to the hack, the exchange shut down all withdrawal and deposit services. It is expected that the exchange will re-open in two weeks.
About the Hack
According to Upbit, hackers made away with 342,000 ETH, which was in the exchange’s hot wallet. Thus far, the exchange has not been able to confirm who owns the crypto address where the ETH was sent. At current market prices, the ETH that was stolen is worth about $50 million. Shortly after the hack, Upbit moved all their crypto assets form hot wallets to a cold wallet.
The Effect on ETH Prices
Since Upbit revealed that it had been hacked, the price of BTC initially dropped below $7,000. Many thought this hack would cause market uncertainty, but actually the opposite has occurred. Despite cryptocurrency prices falling earlier, they quickly reversed and Bitcoin, Ethereum and XRP accelerated 2% + each. You can see the current prices below as it does not reflect a scenario where a large exchange just go taken to town for $50 million… Historically speaking, many market sell-offs have occurred following news similar to what we just saw with Upbit. It was quite interesting to see the market reversal so quickly. It still might be too early to say that this news will have no impact on the markets.
Earlier on Twitter, the Whale Alert account had tweeted that 342,000 ETH had been moved out of Upbit to an unknown location. At around the same time as the hack, Whale alert also noted that various other withdrawals had taken place on Upbit. These withdrawals involved tokens such as BTT, TRX, and others. However, Upbit insists that only ETH was stolen from the exchange. Thus far, about $1.4 billion worth of crypto has been lost to hackers. Before this hack, Upbit was the only major crypto exchange in South Korea that had not been hacked. This could dent its reputation as a trusted exchange. However, like other crypto exchanges in the nation, this setback is expected to be temporary.
Other Recent Hacks
At the start of this month, VinDAX, a relatively unknown crypto exchange based in Vietnam, was hacked. It is estimated that the exchange lost about half a million dollars in crypto. In July, Bitpoint, a crypto exchange based in Japan, was hacked and it lost about $32 worth of crypto. Bitrue, a Singaporean exchange, was also hacked in June. During the hack, it lost about $3 million worth of ADA and XRP. Other exchanges that have been hacked this year are DragonEX, Bithumb, and Cryptopia.
How to Keep Crypto Assets Safe
If you often trade on crypto exchanges, it is important that you only keep a small percentage of the crypto you are trading in the exchange’s wallet. Even with the best security measures in place, all it takes is one slip and hackers could walk away with your assets.
When you withdraw your crypto assets, it is important to store them in a cold wallet, which is a crypto wallet without a connection to the internet. There are numerous options from which to pick in the market. Alternatively, you could use your old phone as a cold wallet. You just need to ensure that you never use it to access the internet.
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