The crypto world’s latest hack sees Israel’s Bancor lose $23.5M
Bancor, a crypto company that touts a decentralized exchange service, has lost some $23.5 million of cryptocurrency tokens belonging to its users following a hack.
The Israel-based company raised over $150 million in an ICO last year and its services include a wallet with a built-in exchange service. Today, Bancor said in a statement that “a wallet used to upgrade some smart contracts was compromised.” As a result, the attackers made off with $12.5 million in Ether, $1 million in Pundi X’s NPXS token and $10 million in Bancor’s BNT.
Bancor said it has frozen the BNT, but it is unable to do the same to the other tokens. The company added that it is communicating with a number of exchanges in a bid to “make it more difficult for the thief to liquidate” the stolen tokens, but it remains to be seen how successful those efforts will be.
Following the incident, Bancor has taken its exchange offline while it conducts an investigation. There’s no word on when it will resume operations.
Critics on Twitter, including Litecoin creator Charlie Lee pointed, out that the irony that Bancor, which claims to be decentralized, responded to the hack with strategies aligned to a centralized system.
Speaking at TechCrunch’s Blockchain event last week, Ethereum creator Vitalik Buterin said centralized exchanges should “go burn in hell”. Buterin’s disdain is mainly focused on greed since centralized exchanges demand large fees up front to list tokens, but given the regularity that exchanges are hacked for large sums of tokens owned by their users — seemingly monthly, if not weekly — security is another issue on the table.
In a further piece of irony, Bancor voiced support for Buterin’s comments just days before its service was hacked.
The Bancor attack completes a bad day of news for the crypto world after some users of popular wallet service MyEtherwallet were thought to have been hit by an attack after VPN service Hola was compromised by hackers.
Note: The author owns a small amount of cryptocurrency. Enough to gain an understanding, not enough to change a life.