Bitfinex, one of the largest cryptocurrency exchanges by trade volume, has resumed operations after being down for an hour due to a distributed denial of service (DDoS) attack that took place on June 5th, 2018.
A DDoS attack occurs when a hacker floods the network with requests, so typical services are rendered unavailable to customers. On June 5th, the exchange was completing unplanned maintenance after stating the network was “under heavy load” before suffering the DDoS attack. These DDOS attacks have increased drastically since 2016. According to Bitfinex head of marketing, Kasper Rasmussen, in an email statement to Bloomberg:
“The exchange was offline for an hour following the DDoS attack; however, the exchange is back online now. The attack only impacted trading operations, and user accounts and their associated funds/account balances were not at risk at any point during the attack.”
These attacks are nothing new to this particular exchange, or to the cryptocurrency exchange industry as a whole. In 2016, Bitfinex lost $68 million due to a hack and also suffered from DDoS attacks in 2017. This Bitfinex DDoS attack took place five days before the South Korean Coinrail hack on June 10th, which was attributed with driving down the price of Bitcoin to new lows. $40 million in tokens was stolen in the Coinrail hack, mainly NPXS ($20 million), Aston X ($14 million), Dent ($6 million), and TRON ($1 million). The exchange lost 30% of all available tokens.
Earlier this year, Japanese exchange Coincheck was hit for a much larger figure of $530 million of the NEM cryptocurrency, leading to a regulatory crackdown of the Japanese cryptocurrency market and a series of new guidelines. Bitgrail in Italy and Coinsecure in India were also hacked this year.
Bitfinex is arguably the worlds largest Bitcoin trading exchange by volume, and thankfully, it was able to resume operations after an hour with no serious effects. A hack on this exchange could seriously affect the market, especially given the recency of the Coincheck and Coinrail hacks, all taking place in Asia. While users were not happy with having their assets frozen on the exchange, there are no serious concerns. Even large networks, like VISA, have been shown to undergo periods of downtime.
Digital Nomad with an interest in Zen and Blockchain technology.
Law graduate with 3 years experience as a consultant in the capital markets industry and 4 years experience freelancing on UpWork as a Creative Writer.