Companies
Crypto Exchange Deribit Undergoes Hacking, Pauses Withdrawal
Following a series of hacking incidents in the Web3 space, the cryptocurrency options exchange Deribit has been the new victim, as per a post by the exchange.
Deribit hot wallet compromised, but client funds are safe and loss is covered by company reserves
Our hot wallet was hacked for USD 28m earlier this evening just before midnight UTC on 1 November 2022.
— Deribit (@DeribitExchange) November 2, 2022
The report reveals that Deribit has stopped withdrawals as a result of the attack, in which hackers stole $28 million in funds.
It was gathered that the hot wallet of the crypto platform was compromised while efforts are still being made to unravel the causes of the attack.
Meanwhile, the exchange assures its users and clients that there is no cause for alarm as lost funds would be covered by Deribit’s reserves.
Client assets, Fireblocks or any of the cold storage addresses are not affected. It's company procedure to keep 99% of our user funds in cold storage to limit the impact of these type of events.
The hack is isolated & quarantined to our BTC, ETH and USDC hot wallets.
— Deribit (@DeribitExchange) November 2, 2022
The platform emphasises that it is their responsibility to keep users’ funds in cold storage in order to avert awkward circumstances like this, stressing it has not departed from such responsibility.
However, the exchange informed that deposits already processed before the attack will be processed after confirmation but withdrawals such as custodians Copper Clearloop and Cobo will be put on hold for now.
The platform also reiterated that the Deribit insurance fund was not affected by the hacks, stressing that the exchange remains in a very strong financial position.
Season of Crypto Hackings
It appears hackers are having a field day in the crypto space following a series of successful hackings that have been recorded in 2022. Blockchain firm Peckshield recently reported that $2.98B have been stolen in digital assets as of Oct. 31.
While October broke the all-time record of crypto exploits given the numerous cases of hacking that occured in the month, it seems November is taking similar trend with the first case recorded by Deribit.
It should be noted that Deribit is one of the largest crypto derivatives exchanges in the world, which enables users to trade crypto futures and options.
As of now, Deribit’s daily trading volume is down by 40%. At the time of writing, the trading volume is $314 million, as per data from CoinMarketCap.
More than any other time, both Centralized and Decentralized exchanges and protocols should strengthen their security against potential attacks.
