Cryptocurrency has a reputation for being safe and transparent. But regrettably, there are some biggest crypto exchange platforms that faced the worst hacking incidents. They were targeted by cybercriminals and these largest crypto exchanges were left vulnerable.
Many of the crypto exchange websites have open-source code libraries. This left them defenseless, allowing scammers to steal thousands of cryptocurrencies in no time. However, for every trader security is the top priority when they are looking for a crypto exchange to start their crypto trading journey. Here, let’s find out which crypto exchanges faced the worst hacking incident and how they have improved and their security to eliminate the risk of system breaches.
Biggest Crypto Exchanges Cybertheft Cases
There are many crypto exchange companies that underwent historical cyber theft incidents. Here enlisted are some of the most popular and highly damaging ones:
The biggest crypto exchange scam of 2020 was faced by KuCoin. It’s a Singapore-based crypto exchange operating since 2013. In September 2020, they were hacked and scammed for over $281 million. However, due to modern technology and swift management, KuCoin was able to recover $204 million within a week. The crypto exchange covered the losses of all its users and retained their tarnished image.
Some crypto exchanges don’t learn from their mistakes. This happened with Mt. Gox, a Tokyo, Japan cryptocurrency website. In 2011, they got hacked, and the hackers looted $8.75 million. The website promised to improve the overall security mechanism. But unfortunately, they again faced another hacking incident in 2014 where more than $615 million was gone into the thin air.
Despite exceptional security protocols, the biggest crypto exchange website faced the worst hacking incident. It’s important to remember that Binance is the world’s largest crypto exchange. They claim to have a unique crypto ecosystem that ensures safety and security. In 2019, hackers withdrew 7000 bitcoins from the hot wallet of Binance. The loss amounted to $40 million.
However, the exchange has funds insurance available and accommodated all the users accordingly. This is the best aspect about any credible exchange, how does the exchange facilitate the users in case of theft or system failures.
As for now Binance has top-notch security measures in place that ensure security to user funds and transactions around the globe. These security protocols include 2FA, bio metric logins and especially the cold storage. All the user funds are stored in an offline digital wallet so that when there is a hack, the hacker is unable to access the offline user walled.
Headquartered in Japan, Coincheck is listed under the top 20 crypto exchanges across the globe. In 2018, hackers managed to steal crypto from Coincheck worth $534 million. As soon as the breach was noticed, Coincheck froze all the deposits and withdrawals. However, the loss was done, and the company admitted not being able to cover the losses of their users.
Bitmart is one of the largest crypto exchanges in Cayman Island from the British Overseas Territory. In 2021, it was reported that hackers hacked their mainframe and got access to some hot wallet keys. They stole more than $200 million, and the amount is never recovered. To date, many people claim that the company has not covered the losses of every victim of this unfortunate cyber-attack. Therefore, when you are looking into an exchange for making a trade then take some time to get into its history either there are some security incidents and how the company managed the situation. It is better to be safe than sorry.
One of the most interesting hacking cases happened with Poly Network, a Chinese crypto exchange platform. The hacker stole $600 million but Poly Network, instead of feeling defeated, praised the hacker. They called him “Mr. White Hat”, someone who helps in researching flaws and improving security. The hacker felt motivated and eventually returned all of the money.
With low security and an unsafe environment, even the biggest crypto exchanges are vulnerable to such scams. The hackers are smart and able to detect the slightest of errors. Therefore, when you are doing your research for choosing a crypto exchange it’s crucial to opt for an exchange that has high-end security protocols to safeguard user funds and a strong framework leaving a minimal window for any kind of cyber breaches.
As for all the above-mentioned incidents, the exchanges now are completely secure and have various security checks in place.