They Stole $15M From Crypto.com Cryptocurrency Exchange: What Happened

The exchange of cryptocurrencies Crypto.com had to stop its operations due to a possible cyberattack on its “hot” wallets, better known in English as “hot wallets”.

These types of virtual wallets are used to store cryptocurrencies and users can manage their assets.

Their main characteristic is that they work connected to the internet. This, on the one hand, is a benefit since they are easy to use by their users. But nevertheless, they are more vulnerable to cyberattacks from criminals.

Over the years, several exchanges suffered million-dollar thefts and hacks to their hot wallets, leaving their clients’ accounts at $0.

One such case occurred in 2020, when the cryptocurrency platform Kucoin lost $280 million in a security breach.

For this reason, most of the major platforms now store the bulk of their client funds on cold safes (known in English as “cold wallets” and “cold storage”) They work without internet connection.

Nevertheless, Crypto.com continues to use hot wallets and this week, users noticed fraudulent money movements, which alerted the company.

“We have a small number of users reporting suspicious activity on their accounts. We will be pausing withdrawals shortly as our team is investigating. All funds are safe.” the firm tweeted.

Hours later, they announced that the cryptocurrency withdrawal services were already enabled and stressed again that “all funds are safe”.

Cold wallets do not depend on the internet, while hot wallets do. Therefore, the latter can be violated.

One of the first millionaires to notice the hack was Billy Markus, the founder of cryptocurrency Dogecoin. Through Twitter, Markus published all the information of a suspicious transaction on Crypto.com.

“I am seeing very strange activity on one of the Crypto.com hot wallets that stores Ethereum. It is a pattern: there are new wallets that receive between two and five ethers; and then the funds don’t move”, explained the creator of the Dogecoin cryptocurrency.

Ethereum is the blockchain and ‘ethers’ are the tokens of the smart contract network.

“Are money transfers and funds secure from the platform? Is it hackers taking funds from a hot wallet from the Crypto.com exchange? There is never a dull day in the world of cryptocurrencies“, he tweeted.

Although Crypto.com reported that no cryptocurrency funds had been stolen, the security firm and blockchain PeckShield estimates that cybercriminals took possession of $15 million in cryptocurrencies, unos 4,600 ethers.

“This money is being laundered”, they warned.

In this line, several crypto millionaires say they have been violated. One of them is Ben Baller, a well-known jeweler from the United States who invests in digital assets.

Via Twitter, Baller took direct aim at the exchange: “I sent you a message hours ago because my account is missing 4.28 ethers. They vanished” wrote.

As the adoption and popularity of the cryptocurrency market increases, the number of violations security Y hacks also reaches new highs. And this phenomenon is far from over.