UpBit Exchange Hacked for $49 Million. No FUD induced

According to the official press release published earlier today, cryptocurrency exchange UpBit suffered an attack this morning. Attackers hacked UpBit exchange for roughly $49 million in Ethereum (ETH).

This is the first such malicious action against this South Korean trading platform.

Ethereum transferred in a single transaction

The announcement was the confirmation of users’ suspicion despite the fact that the exchange suspended all deposits and withdrawals due to the routine maintenance earlier.

During the attack, hackers have transferred 342,000 ETH from the exchange’s hot wallet to the ETH address 0xa09871AEadF4994Ca12f5c0b6056BBd1d343c029. The address was immediately marked as the hacker’s in the ETH block explorer.

UpBit Hack marked address

The disputable address also got the tag Upbit Hacker 1 and still has 7 pending incoming transactions for 0.00001337 Ether. Interestingly enough, besides ETH, the address also holds $120 in various ERC-20 tokens. $6,54 in CoinBene Coin (CONI), $17,7 in Mystery Ghost Tokens (MGT), and $94.90 in Xeniacoin (XEN).

Upbit exchange hacked TX

UpBit reports that, besides suspending deposits and withdrawals, they immediately transferred all crypto-assets to the cold storage. The exchange also offered their assurance that they will reimburse the full amount of ETH with their assets. Furthermore, UpBit informed their clients that it will take approximately 2 weeks until the exchange returns to full operability.

The industry supports hacked UpBit exchange

At the end of the press release, UpBit placed a call to action:

We ask for the crypto community’s support in blocking deposits from the anonymous address 0xa09871AEadF4994Ca12f5c0b6056BBd1d343c029.

It didn’t take long for the industry leaders to respond. Among the first ones was the CEO of Binance, Changpeng Zhao, who expressed his company’s willingness to collaborate. The popular CZ stated that Binance will work with Upbit and others to immediately freeze the funds which may find their way towards his exchange.

Interestingly enough, after some individuals from the community stated that frozen accounts are opposite to the nature of crypto, CZ directed them towards the BinanceDEX. BinanceDEX is a decentralized exchange without classical hot wallets and deposits. Naturally, the community brought up the possibility that the stolen funds may also go that way. The remark passed unanswered.

This brings up the issue of positives and negatives of decentralized exchanges since they really do offer the opportunity to cash out on the ill-gained funds.

The biggest hack of the year

While a portion of the crypto community states that $49 million can’t be regarded as a big hack, it is the biggest hack of 2019. The second in that line is, in fact, CZ’s own Binance from which hackers took roughly $40 million in Bitcoin in May.

Of course, $49 million is peanuts if we compare it to Coincheck $534 million theft. Nevertheless, it is a good reminder that centralized exchanges are lightyears away from the security level of serious businesses.

Cryptocurrencies shrug off the FUD

More often than not, these kinds of events reflect negatively on the cryptocurrency market in general. However, this time, it doesn’t seem to be the case.

Despite the unfortunate UpBit situation, Bitcoin broke through the $7,400 resistance with the daily rise of 5%. Currently, BTC is steady at around $7,500. The number one coin isn’t alone in green. The vast majority of the top 100 cryptocurrencies are recording gains at the time of the press, with the top gainers being IOST and STEEM with 14% and 13% respectively.