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Major Bitcoin Exchanges report cyberattacks - Are clients' funds safe?

Major Bitcoin Exchanges report cyberattacks - Are clients' funds safe?

Following the Bitcoin rally, two of the largest Bitcoin Exchanges report cyberattacks. Were the attacks carried out with the purpose of manipulating the prices?

16 June, AtoZForex – With investors’ interest in Bitcoin exchanges and trading platforms on the rise, hacking attempts and other cyber attacks have also increased.

Major Bitcoin Exchanges report cyberattacks

Just this week, two major Bitcoin exchanges reported cyber attacks cases. The largest US dollar based Bitcoin exchange, Bitfinex, has informed the public that its platform appeared under distributed denial-of-service attacks (DDoS). This is very popular type of attack, normally aiming to paralyze a system with a flood of information.

The other Bitcoin exchange, BTC-e exchange, has reported the similar attack on its systems. Reportedly, the website of this Bitcoin exchange was temporarily down.

What is the reason for Bitcoin hacker attacks?

Even though the hackers’ attempts caused some disruption in regular activities of exchanges, no harm to users was reported. One of the possible reasons for the Bitcoin hacker attacks – the momentary interruption of service during the bull run with the purpose of manipulating Bitcoin market prices. Considering the growing popularity of digital currencies, this option might be actually possible.

Just yesterday, AtoZForex has reported that cryptocurrency markets have been struggling. As Bitcoin price dropped, erasing all the June gains, other digital currencies also followed the downtrend. Except for Ripple! This cryptocurrency market player has gained 10%. The Blockchain products lead at ARK Invest, Chris Burniske, has commented:

“There’s a big difference between a denial of service attack and a hack that causes clients to lose funds. As of yet, we’re fortunately not seeing any of the latter.”

As Bitcoin Exchanges report cyberattacks, hot discussion about the regulation of the cryptocurrency is getting fueled. Where none of the global regulators actually oversee the digital currency market, this can emerge as an opportunity for scammers to defraud investors. Previously, we have discussed the countries where Bitcoin is illegal and legal. 

Smaller Bitcoin exchanges – easier aim for scammers

This kind of illegal activity is not new for the major Bitcoin exchanges. In fact, this has been a trend for the past few years. So, most of the well-known platforms and websites have learned from past experience and improved their security infrastructure.

Moreover, there have been upgrades to manage the increasing traffic. In the beginning of cryptocurrency era, many websites were not prepared to handle such heavy duty. However, now large Bitcoin exchanges look into opportunities to provide superior protection for the users.

Yet, smaller and less developed exchanges still appear as an easy aim for scammers. Therefore, it is recommended to exercise extreme caution, while considering Bitcoin investment opportunities.

This article was written by Ian G. Diaz, BA in Research and Literature Critic of the National Autonomous University of Honduras. If you like this article, please share it. 

Think we missed something? Let us know in the comments section below.

Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.

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