Bitfinex, one of the largest cryptocurrency exchanges out there, suffered a hack attempt on its web page, as reported by the same site incidence report page yesterday. The platform was unreachable for three hours and several users reported their discomfort in not being able to trade during this time.
The hack attempt was classified as a Distributed Denial of Service attack (DDoS), a type of attack that consists in overwhelming the site servers with many requests to stop the site from functioning. The attack caught users off guard because the site had been down the same evening due to “unplanned maintenance”, that according to their Twitter account information had to do with their trade engine functions.
Bitfinex stated that the attack happened on the external layer of the platform and that all users funds were secured. Luckily for Bitfinex, prices during the downtime did not change much at all, but still, users complained about losses caused by the inability to trade during the downtime.
A Japanese exchange called Coincheck, that also suffered a hack for more than 550 million dollars, froze their operations to protect customers after the incident. This seemed like the best course of action, but customers were unhappy and filed a class action suit against the exchange due to the loss of money that they suffered due to the inability to withdraw their funds. That is why exchanges attempt to resolve these issues swiftly.
Bitfinex is one of the most important exchanges, the fourth in trading volume, only trailing Binance, OKex, and Huobi, according to CoinMarketCap data. But even a big exchange like this has had several security problems in the past. In 2016, Bitfinex was hacked and lost 72 million dollars worth of bitcoin, being fined with 75,000 dollars due to lax security practices. Bitfinex issued a cryptocurrency to reimburse the affected users, and for 2017 they had paid the whole amount.