One of largest Cryptocurrency exchanges in the world, Bitfinex, experienced a cyberattack Tuesday morning,s but resumed normal operation later in the day. The attack led to a 2% reduction in the price of Bitcoin.
How Bitfinex Was Attacked On Tuesday Morning
Bitfinex became a victim of distributed Denial-Of-Service attack (DDoS), which overwhelms a system with several virus-infected servers.
The Hong Kong-based Cryptocurrency exchange added that the previous shutdown was as a result of one of its servers. The company further added that during the recovery, the virus caused more load on the servers.
As the news of the attack spread, CoinDesk reported a 2% reduction in Bitcoin price to $7,373.47.
The company was started in Hong Kong in 2012 and the attack was not the first one on the company. In June last year, the business was a major target for hackers. In 2016, the exchange was attacked and lost about 120,000 bitcoins.
Bitfinex Resumes Operation
At around 11 a.m. ET, all services were resumed. Upon reopening, the firm said that it was on high alert and was observing the situation keenly. The company has confirmed that all account balances are intact and were not attacked. They added that the cyberattack affected only trading operations.
Cyberattacks On Various Cryptocurrency Exchanges
Cryptocurrency exchanges have been very innovative and progressive to meet customer needs. Moreover, the exchanges must keep fighting hackers to avoid loss of bitcoin and other cryptocurrencies.
Various Cryptocurrency exchanges around the world have been victims of cyberattacks. These attacks have made Cryptocurrencies to appear to be insecure and encouraged their criticism. Here are some of the exchanges that have been victims of cyberattacks.
• In January this year, Coincheck, a Japanese exchange was a victim of cyberattack. During the attack, the hackers walked away with $500 million worth of a less-popular Cryptocurrency.
• The 2014 largest bitcoin exchange Mt. Gox became a victim of a cyberattack and lost more than 75,000 bitcoin.
• In December 2017, NiceHash became a victim of a cyberattack and lost more than 4,700 bitcoins. The market value of the bitcoins during the attack on the Slovenia based Cryptocurrency was $63 million.
• In December 2017, Youbit, a South Korean exchange lost 17% of its digital assets and filed for bankruptcy later.
Although the Cryptocurrency exchanges are attacked while still using Blockchain technology, the same technology could be crucial in stopping DDOs attacks. Businesses can enhance the capacity of its website traffic through hiring bandwidth on the platform.
The Impact Of A Cyberattack On Cryptocurrency Business
• Cryptocurrency and Blockchain technology are new concepts to many people. Current and potential investors on the platform are discouraged from investing in the sector in case of an attack.
• The value of the affected Cryptocurrencies falls.
• Many investors make losses as a result of the reduction in the value of Cryptocurrency.
• Companies make huge losses from theft or lack of confidence and business that comes later. Some companies become bankrupt.
Despite cases of cyberattacks being common, Blockchain technology still seems to be the technology of the future. It is one of the best technologies that multinational companies will be using in the near future. Even large companies such as Microsoft and Amazon among are planning to use the technology on some of their online platforms.