Bitcoin plummets after cyberattack on South Korea exchange

By Ed Adamczyk Contact the Author   |  June 11, 2018 at 9:15 AM
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June 11 (UPI) -- The value of bitcoin fell dramatically Monday after a cyberattack on a South Korean cryptocurrency exchange caused the market to plummet 30 percent.

The value of bitcoin lost $500 on Luxembourg cryptocurrency exchange Bitstamp in one hour -- falling to a price of $6,627 -- after the currency exchange Coinrail reported the theft.

Although the attack involved altcoin, a lesser known cryptocurrency, officials said prices of all cryptocurrencies fell.

Coinrail said in a statement it suspended digital currency trading and is cooperating with authorities. About $19.5 million in altcoin was stolen.

While South Korea has become a hotbed of trading in cryptocurrencies, Coinrail is among South Korea's smaller trading platforms. Analysts said the attack highlights the weak regulation and security of the industry.

Coinrail called the breach a "cyber intrusion" and said 70 percent of total coin and token reserves "have been confirmed to be safely stored and moved to a cold wallet," which is a file not connected to the Internet.

"Two-thirds of stolen cryptocurrencies were withdrawn or frozen in partnership with related exchanges and coin companies. For the rest, we are looking into it with an investigative agency, related exchanges and coin developers," Coinrail said.

The hack is the latest in a string of Asian cyberattacks. In December, South Korean exchange Youbit closed and filed for bankruptcy after two hackings. Japanese exchange Coincheck was hacked in January and lost over $500 million in digital currency. Customers were reimbursed in March but the exchange faces two class-action lawsuits.

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