3 - 4 minute read
South Korean crypto exchange Gdac has announced that it was hacked for nearly $13 million on Sunday, marking yet another major security breach in the industry. Hackers were able to transfer almost 23% of the total custodial assets held by the platform, leaving traders understandably concerned about the safety of their investments.
According to reports, the hackers stole more than 61 bitcoin (BTC), 350.5 ether (ETH), 10 million wemix token (WEMIX) and 220,000 USDT before absconding with the funds. Gdac has said that it informed the authorities about the attack and is now working tirelessly to recover as much of the stolen funds as possible. However, there is no telling whether it will be successful in its efforts.
Unfortunately, Gdac is not the first crypto platform to suffer a significant hack within the past year alone. Others, including Axie Infinity’s Ronin bridge and DeFi protocol Sushi, have been exploited for millions of dollars in recent months. In the Sushi case, hackers managed to access the approval contract and make off with $3.3 million in funds.
Crypto-exchange hacks are becoming too common and continue to fuel traders’ concerns about the asset’s safety.
According to a recent report by CipherTrace, losses to hacks and fraud accrued $4.5 billion between 2019 and 2021. It is clear vast sums of money are being taken, and the question remains: just how secure is the cryptocurrency industry, and what more can be done to safeguard users’ assets?
Cryptocurrency exchange hacks, in particular, have become a common occurrence, to the point where most traders now expect them to happen sooner or later. The particularly alarming aspect of this latest hack is the sheer scale of the theft, which could turn even more traders away from the crypto sector.
So what does this all mean for investors in cryptocurrencies? While thefts like these continue to happen, traders are strongly advised to be extra cautious when investing in cryptocurrencies.
Firstly, it’s worth noting that cryptocurrency isn’t a regulated financial instrument, and there is a risk of total loss to its users. It would be wise to store assets in cold wallets, which are offline storage devices more secure in defending you from hacks.
Secondly, there is the need for stricter enforcement of KYC regulations by regulatory authorities to combat fraudulent activities. Although several countries have KYC regulations, several exchanges remain unregulated. Since cryptocurrencies are deemed high-risk assets, obtaining vast identification and documentation from traders will likely be the new normal in the future.
It’s high time cryptocurrency exchanges take extra precautions in securing the funds of their investors. The more security measures in place to protect user funds, the more trust traders will have in the cryptocurrency sector.
