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Crypto.com reportedly loses $15 million worth of Ethereum (ETH) to hackers

Posted on by admin
18
Jan
  • Blockchain security company PeckShield has disclosed that Crypto.com lost about $15 million in Ethereum from the recent incident. 
  • However, a tweet by the CEO of the exchange Kris Marszalek claimed that no funds were lost.

In the early hours of Monday, users of Crypto.com stormed the various social media with complaints of suspicious activities in their accounts. Some of the users disclosed that they had lost some cryptos from their balances with others complaining that all their funds were missing. In response to this, Crypto.com announced on Twitter that it is restricting withdrawals for all users on the platform while ensuring that their funds were safe. It took about 14 hours for the company to resume withdrawals.

A tweet by the CEO of the exchange Kris Marszalek claimed that no funds were lost. He also mentioned that the team is conducting an internal investigation of the security incident, and have made efforts to bolster its infrastructures. 

Some thoughts from me on the last 24 hours:

– no customer funds were lost

– the downtime of withdrawal infra was ~14 hours

– our team has hardened the infrastructure in response to the incident

We will share a full post mortem after the internal investigation is completed.

In addition to the comment of the CEO, the exchange also claimed that only a small number of users have complained of being affected.

However, users came out in their numbers to say otherwise.

Crypto.com users backlash

The number of complaints continuously increased as some users claimed to have lost huge sums, calling on the exchange to do something about it. Also, a blockchain security company PeckShield has disclosed that Crypto.com lost about $15 million in Ethereum from the recent incident. Its investigation discovered that half of the stolen funds were laundered through Tornado Cash, an Ethereum powered coin mixing service. Some users have criticized the exchange for keeping the amount of money lost in the incident from the public.

A user identified as Mas 🔺 (@JTuxon) tweeted:

Their Twitter is “all funds are safe, back to normal” but they never mentioned how much has been stolen or giving information of what happened… such poor communication from them. Thank you PeckShield!”

Ben Baller, an entrepreneur and crypto enthusiast was one of the victims of the incident. According to him, 4.28 ETH ($13,500) was stolen from him despite enabling two-factor authentication on his account. This means the hackers had to circumvent some of the security protocols of the exchange to execute that activity. 

Attacks on crypto exchanges have been very rampant in the last 12 months. In October 2021, Coinbase announced that about 6000 users’ funds had been swiped. According to the announcement, the attacker took advantage of the loopholes in the SMS recovery texting process. Also, a crypto-security firm Immunefi.com discovered that $2.66 billion was lost through hacks in 2021. According to other firms, at least $4 billion was lost to hackers last year. BitMart also reportedly lost $200 million at the end of the year in a single hack. 

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