Bitcoin dives 20% following $77m hack

The value of bitcoin slumped 20% following the $77m hack of Bitfinex, one of the most-popular cryptocurrency exchanges. The company announced that it is halting all trading as a result of the security breach that saw 119,756 bitcoins stolen.

According to CoinDesk’s BPI the cryptocurrency’s price against the dollar dropped from $631 to $518 in less than 24 hours. It has since recovered slightly to $555.

The cause of the hack is still unknown with Hong Kong-based Bitfinex saying in a statement: The theft is being reported to and we are co-operating with law enforcement.

The company is a client of Palo Alto-based bitcoin security firm BitGo, though it says it is yet to find any evidence of a breach on its servers.

BitGo provides segregated wallets for each user that are meant to be safer than large communal wallets. This means not every Bitfinex user will have lost bitcoin.

However, the company may choose to pool all users bitcoin together to issue refunds proportionally with all incurring the same loss.

We will look at various options to address customer losses later in the investigation, Bitfinex.

Copyright © 2016 FINTECH GLOBAL

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