In the world of Bitcoin it seems that nearly every week there is a breaking news headline about a company being hacked. It’s an unfortunate situation, but one that Bitcoin seems destined to encounter due to its nature as a decentralized and digital currency. The latest website to be hacked is the Bitcoin and Altcoin exchange Cryptoine, which deals with the top coins such as BTC, LTC and DOGE, but also has markets for Cannabis Coin, Darkcoin and more.
Cryptoine’s website has shut down, and is currently only displaying two updates about what happened. First is the initial report of the hack itself, which begins, “Unfortunately, cryptoine was hacked.” I think this is a bit telling of the overall situation of cryptocurrency security. Those few short words seem likely to have been accompanied by a long sigh as though to say, “yes we were hacked, no we can’t believe this keeps happening to Bitcoin exchanges.”
The initial report gives no details of lost funds, but that changed only a few hours later with the pages second and final post about the site’s hack. A full chart is presented with the currencies and amounts stolen by the hacker, as well as a very chilling statement: “Our hot wallets was drained, coins: bitcoin, litecoin, urocoin, dogecoin, bitcoinscrypt, magi, darkcoin, dogecoindark, cannabis.” Drained is not a word anyone wants to see when it comes to an altcoin exchange being hacked.
And as if placed there by some cruel joke, a quick glance at the company’s pinned tweet on its twitter page shows just how much Cryptoine believed in its security:
Grade A+ security reported by SSL LABS https://t.co/pB3U1FnRZg
— cryptoine.com (@cryptoine) June 21, 2014
The real lesson to be taken from what happened is clearly not that its security should have been graded lower. It’s that cryptocurrency sites across the board need to beef up their security. Not only must they protect the funds of their customers, but they must also do what it takes to keep those customers calm and at all times. Now, I’m not saying that Cryptoine was lacking in its security measures, but when dealing with cryptocurrencies you’re going to be dealing with hackers and with comes certain responsibilities to those who entrust you with their coins.
Cryptoine has assured everyone that it will return all coins – including the stolen ones – to its clients, but the damage has certainly been done. It’s frustrating to keep hearing about these hacks and worrying about which site will be next in the cross hairs. For now, cryptocurrency exchanges must do what they can to improve security, and avoid the unfortunate situation of a devastating hack, and let’s hope that next week’s breaking news is free of headlines about hacking.
