It’s estimated that the South Korean exchange lost over $35 million worth of cryptocurrency and the market has not been kind.
Lesser-known South Korean exchange Coinrail announced today that it suffered an attack in the early hours of June 10.
Custodians of the exchange were able to move most of their customers’ holdings to the safety of a cold storage wallet, but a whopping 30 percent of its reserves was lost. It’s estimated that over $35 million worth of digital assets was purloined, but the precise extent of the damage is unknown. The only specific coins that were confirmed to have been targeted were Fundus X (NPXS), Aston (ATX), and Enper (NPER).
Services were temporarily suspended and an investigation by Coinrail and Korean authorities is ongoing. Little information is being shared with the public at this time so as not to interfere with the probe. The trading platform is inviting its clients to periodically check its homepage for updates.
Coinciding with the announcement, the price of bitcoin (which was already seeing sluggish performance) saw a dip of over seven percent, and much of the crypto market followed suit. It isn’t necessarily the loss of funds itself from this relatively obscure exchange that led to the market slump, but every time an exchange falls victim, investors are also robbed of confidence. CNN reported the overall market loss to be around $30 billion.
The major attack on Japanese exchange Coincheck in late January led its country to beef up security requirements. When fellow Korean trading platform Youbit was hacked in December 2017 (and previously in April), there was speculation that South Korea might ban crypto exchanges altogether, but authorities backed off that strategy. What regulatory consequences, if any, that result from this latest breach remain to be seen.
It should be noted that Coinrail was not among the exchanges that formed the self-regulatory Korean Blockchain Association. A representative of that group told Reuters, “[Coinrail] is a minor player in the market and I can see how such small exchanges with lower standards on security level can be exposed to more risks.”
It’s also unclear if Coinrail will survive this setback; Youbit was slapped with multiple lawsuits and ultimately filed for bankruptcy.
Jen Luker is head copy editor and occasional writer for ETHNews. She is inspired by decentralization, the arts, and social causes. She holds value in ETH.
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Source: ETHNews