#Asia Bitcoin’s rough day: Price tumbles 20 per cent after US$65M exchange theft


The price of bitcoin did recover from the initial plunge, and it will be worth keeping an eye on the cryptocurrency in the coming days

Bitcoin FINAL (1)

The price of bitcoin dropped dramatically today after Hong Kong-based Bitfinex, one of the most popular exchanges available, announced today its security had been breached and confirmed bitcoins had been stolen.

According to Zane Tackett, Director of Community and Product Development for Bitfinex, the number of bitcoins stolen was 119,756. That converts to roughly US$65.1 million dollars as of the bitcoin price at publishing.

Currently, there have been no announcements about potential suspects and the company says it has reported the attack to law enforcement.

As a result of the news, the price of bitcoin plummeted by 20 per cent, according to the metrics used by Coinbase. At its low point, the price had dropped from US$605.37 to begin the day to a low of US$485.54 (a 20 per cent crash).

Also Read: The inevitable marriage of bitcoin and Silicon Bali

The price of bitcoin has recovered slightly and stands at US$545.59 as of publishing — which constitutes a 10 per cent loss on the day.

All trading on Bitfinex was halted due to the hack as well as digital deposits and withdrawals. The company statement read:

“We are investigating the breach to determine what happened, but we know that some of our users have had their bitcoins stolen. We are undertaking a review to determine which users have been affected by the breach. While we conduct this initial investigation and secure our environment, bitfinex.com will be taken down and the maintenance page will be left up”.

Bitfinex said, as the investigation moves forward, it may need to settle open margin positions, associated financing and collateral from the breach. It would do so at the bitcoin price as of 18:00 UTC today— essentially right before Bitfinex announced the breach and the market crashed. The price for that would be US$603.30, according to Coinbase.

Also Read: Once every four years: the summer olympics and  bitcoin halving

The news comes a little less than a month after a major price ‘halving‘ on July 9 reduced the reward received from ‘mining’ bitcoins by half. Bitcoin halving is a tool used to control inflation and the price of the cryptocurrency has been in a gradual decline since the event.

Furthermore, it brings up inevitable comparisons to Tokyo’s Mt.Gox and the debacle that led to the company’s collapse and CEO Mark Karpales spending 10 months in jail. The firm, which at one point was the exchange in charge of 70 per cent of the bitcoin market, filed bankruptcy in February 2014 after it was discovered 850,000 bitcoins — worth about US$450 million — were stolen from sustained attacks spanning years.

For latest updates on the Bitfinex hack, follow updates at Bitfinex.statuspage.io.

Photo courtesy of Pixabay.

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