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World’s Biggest Crypto Bank Heist: Are Digital Coins in Danger?

World’s Biggest Crypto Bank Heist: Are Digital Coins in Danger?

crypto bank robbery
January 29, 2018 | Eva Hanscom

Crypto currency is a hot commodity. According to CoinMarketCap, the total market capitalization of crypto currencies was larger than $600 billion in December 2017. While their worth consistently fluctuates, there is no denying crypto currencies hold significant value.

Unfortunately, the lucrative aspects of crypto currencies make them a very popular target for cyber criminals. And recently, attackers have zeroed in on their exchanges.

On January 26th, Coincheck, one of Japan’s most prominent crypto currency exchanges, revealed that roughly $400 million in NEM tokens was lost due to illicit activity. In response, Coincheck halted all currency trading, which lead to a price drop in Bitcoin and other currencies world-wide.

According to Jing Xie, senior threat intelligence analyst for Venafi, similar attacks on crypto currency exchanges may increase in frequency. “It’s common knowledge that exchanges are the Achilles' heel of the crypto currency ecosystem. They already have a reputation for weak security and guard troves of money. Until these exchanges make serious upgrades to their security investments, I think we’re going to see a lot more of these breaches.”

Unfortunately, some members of the crypto currency community may not believe typical security risks apply to them. “It is very naive to assume that traditional financial institutions are the only target for cyber attackers,” says Xie. “The reality is that cyber criminals will go wherever the money is, and you can be sure that they will flock to any industry where security controls are weak.”

It is possible for exchanges to boost their security methods, but it may be up to the overall community to demand more stringent security controls. “It’s true that crypto currency exchanges are ultimately responsible for the security of their systems and services, but the crypto community also has a responsibility. Collectively they need to demand much better security,” concludes Xie.

Will more crypto heists take place in the near future? 

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About the author

Eva Hanscom
Eva Hanscom

Eva is Public Relations Manager at Venafi. She is passionate about educating the global marketplace about infosec and machine-identity issues, and in 2018 grew Venafi's global coverage by 45%.

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