Theft of cryptocurrency

Colin Baseman

Although 2019 is not over yet, fraudulent transactions and thefts with cryptocurrencies have exceeded $ 4.4 billion. Such statistics were provided by the analytical company CipherTrace for the period from January to September.

Cryptocurrency fraud trends

CipherTrace reported a significant decrease in the number of crimes involving cryptocurrencies. In the third quarter, hackers committed theft from crypto exchanges in the amount of 6.5 million dollars, users lost an additional 8 million dollars.

The report says: "The total amount of 15.5 million dollars is the lowest for crimes in the field of cryptocurrencies in recent years in the quarterly section." In 2018, the theft amounted to 1.7 billion dollars, which indicates a strong growth in 2019.

The largest in the outgoing year were the following fraudulent activities:

  • Pyramid PlusToken (led to a loss of 2.9 billion dollars.)
  • Bankruptcy of the canadian crypto exchange QuadrigaCX (loss of 195 million dollars).

Ciphertrace analysts have done a tremendous job analyzing the kyc120 standards of the most popular cryptocurrency exchanges. 65% of them had weak and vulnerable parameters.

The losses of the last quarter are already exceeded the statics of the third because of the hacking of the Upbit crypto exchange, losses of $ 50 million were recorded.

Plustoken developers suspected of $ 3 billion fraud

The creators of the cryptocurrency wallet PlusToken disappeared, and with them $ 3 billion. of their clients just vanished. The publication stressed that to date, the incident has become the largest Ponzi scheme and scam in the people's Republic of China.

A number of users of social networks note that they can not withdraw their funds. The native token of the PlusCoin platform hovered at $ 139.24. Investors believe that the developers disappeared, taking with them $ 3 billion. customer accounts.

PlusToken started operations in 2018. The wallet acted as a decentralized solution and an "international cryptocurrency project" supported by developers from South Korea. It focused on Asian States, including China, Vietnam, Japan and Myanmar, and attracted users from the European Union.

According to the official website, the co-founder of the project was Mr. Leo, additional information about which is almost absent. A number of data report that the development of the wallet was made by one Chinese organization, which is located in Jiaxing.

PlusToken has the characteristics of a pyramid scheme. For example, users could participate in a referral program, and monthly rewards for invested funds were in the range of 6-19%.

Before that, the company talked about its goal – to have 10 million active users in 2019. In October, their number was 3 million people.

In the spring of 2019, Chinese police launched an investigation into PlusToken. After that, Chen Bo, who heads the unit in China, along with 5 other Chinese citizens went on the run.

Quadrigacx crypto exchange has lost access to 190 million dollars of its users

The QuadrigaCX cryptocurrency exchange from Canada lost access to 250 million canadian dollars of its customers, which corresponds to 190 million US dollars. The company filed a petition with the Supreme court of Nova Scotia.

In the accounts of about 115 thousand customers were cryptographic and Fiat money in the amount of 180 and 70 million canadian dollars, respectively.

According to reports, the exchange stores 26,500 bitcoins, 11,000 bitcoin cash, 35,000 bitcoin gold, 200,000 litecoin and 430000 Ethereum on its wallets. A significant proportion of the money is likely to be in cold storage.

Representatives of QuadrigaCX said that the head of the company, Gerald Cotten, who died last year in India, was solely responsible for the management of cold wallets. Evidence of his death was never presented to the community.

Payment processors WB21 and Billerfy blocked the share of Fiat funds of the exchange: the first does not respond to incoming requests, and the second does not have a banking partner to process existing payments. To date, the site of the quadrigacx platform is not available for "technical reasons".

Hackers stole 50 million dollars from the exchange Upbit

Upbit crypto exchange confirmed the vulnerability to hacker attack. The platform from South Korea as a result of hacking lost 342,000 Ethereum, which corresponds to 48.2 million dollars. The money was stolen from a hot wallet. At the time of preparation of the article, the site did not perform operations on the introduction and withdrawal of assets. All funds of the exchange are now on cold wallets. The company intends to fully recover the losses.

On the MyCrypto platform, transfers of TRX tokens from the South Korean exchange for a large amount were revealed. A number of observers believe that the theft involved an employee of the site, who acted as an insider. This assumption they explain the theft just at the time when the exchange moved its funds.

The bithumb crypto exchange has been attacked by hackers three times in the past three years. There is speculation that North Korea is behind the attacks.

Today, many exchanges provide comparative protection of their clients' assets. Read about one of them in the article "Kucoin Review".

How to protect yourself from cryptocurrency fraud

There are simple ways that will reduce the likelihood of theft of digital money:

  • Check your apps and browser address bar. Use only official products
  • Do not install questionable extensions in your browser, especially for cryptocurrencies
  • Check accounts and social networks
  • Check e-mail, Wi-Fi and SMS messages

What does the increase of theft of cryptocurrency signify? Digital money continues to pose risks for investors. As you can see, a significant part of the losses associated with the hacking of exchanges and the use of pyramids. Therefore, try to avoid participating in questionable ways to get rich quickly, and do not store money on trading platforms for a long time. If possible, it is better to withdraw them to the official or "cold" wallet. So you can significantly improve security.