Anyone venturing into the digital currency scene understands the significance of performing analyses to evaluate potential gains. Security breaches and hacking are a constant risk when it comes to the realm of cryptocurrencies.
Nevertheless, the level of security and protection offered by the trading platform chosen is often overlooked. Consequently, this oversight has so far resulted in a loss of approximately $4.26 billion. Whenever scammers or hackers are successful in their fraudulent practices, this results in an average loss of $43 million.
2 Notorious Cases where Security Failed
Reputability and popularity do not guarantee protection from malicious behaviour. To fully understand the gravity of fraudulent activity and security breaches, one must keep in mind some of the most infamous security failures in recent history.
1. Bitfinex
Loss: 120,000BTC or $72 million in assets (2016)
Considered as one of the most prominent cryptocurrency exchanges globally with about two million users, Bitfinex sees billions of dollars’ worth of transactions daily. This successful exchange fell victim to a major hack back in 2016, having the amount of 120,000BTC stolen, which was equivalent to $72 million. In today’s prices, that would be a much higher figure. Bitfinex used to offer multi-signature wallets through BitGo, a feature created to enhance user security. However, 12 months after this component was introduced, the hack occurred.
The question was raised: what made Bitfinex susceptible to this fate? The way its accounts were structured was the first step towards security failure – to withdraw a large amount of funds, BitGo would likely have had to sign off transactions.
The hack caused Bitcoin’s market value to drop by a staggering 20%.
2. Binance
Loss: 7,000BTC or $40 million in assets (2019)
Binance is widely believed to be the world’s largest crypto exchange, based on trading volumes. Despite this, the exchange was not able to avoid a phishing scam or recognise the virus-type malware that was used to hack into it. The group of hackers got away with $40 million worth of Bitcoin.
In one of his blog posts, CEO Changpeng Zhao announced that Binance will make “significant changes to the API, 2FA, and withdrawal validation areas, which was an area exploited by hackers during this incident.” Zhao vowed to work on “more innovative ways” to prevent risks and improve KYC, whilst enhancing user and threat analysis,
Providing a Viable Solution
When looking into investing assets, finding a trusted source that provides detailed research and relevant information about cryptocurrencies and trading platforms is critical. Nowadays, there’s a smorgasbord of online resources – one never knows which to trust. Nevertheless, it is important to be selective when it comes to deciphering between a trustworthy source and one that gives little to no guidance.
Cryptimi.com provides information that examines aspects of payment methods, security, fees, and customer support. For the ultimate user experience, it even lists the latest reviewed and top-ranking cryptocurrency exchanges (with regular updates when positions shift), to make for a more reliable search. The user can customise the search by filtering results and specifying the preferred deposit method, jurisdiction, and the type of platform.
Doing the Legwork Before Taking the Plunge
Finding the best cryptocurrency exchange is imperative prior to venturing into any kind of financial investment. This holds true for both novice investors, and veteran traders. Both investors and traders should have a reliable point of reference when conducting their research.
A reputable reference site like Cryptimi equips the reader with all the right tools to take an informed step by constantly publishing trustworthy, unique, and relevant content.
Indubitably, cryptocurrency exchange platforms are an essential piece to the digital currency puzzle, because they are the link that allows individuals to buy, sell, and trade cryptocurrencies. Nevertheless, before investing or trading on a new broker or exchange, one needs to ensure that the funds being invested will be utilised to their full potential. Fortunately, you can put both your mind and assets at rest with Cryptimi.com – your only go-to reference that guides you to your financial growth.
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