In this article, you will learn what is the Bitmart hack. As the value of cryptocurrencies has risen, the hackers and scammers are trying to hijack the cryptos from the users and exchanges. There are many examples for it and the recent one was the Bitmart hack.
What is Bitmart?
Bitmart is one of the most trusted cryptocurrency trading platforms. BitMart consists of advanced architecture with strong security features which increase its scalability and stability. BitMart allows individuals and institutions to buy, sell, and trade over 1.000 cryptocurrencies. In addition to advanced cryptocurrency spot and futures trading dashboards, BitMart offers a simple buy/sell crypto feature for beginners and a range of crypto-earning opportunities.
What is the Bitmart Hack?
The latest centralized exchange hack may be among the most devastating to date as BitMart has lost $196 million in various cryptocurrencies on 4th December 2021.
A tweet from security analysis firm PeckShield first called attention to the alleged hack Saturday night. One of BitMart's addresses currently shows steady outflows of entire token balances, some worth tens of millions of dollars, to an address by HatherBits as currently labeled E “ .”
In a follow-up tweet, PeckShield estimated the losses to be $100 million in various cryptocurrencies on the Ethereum blockchain and $96 million on Binance Smart Chain.
The hacker has been systematically using decentralized exchange (DEX) aggregator 1inch to swap the stolen assets for the cryptocurrency ether (ETH), and using a secondary address to deposit the ETH into privacy mixer Tornado Cash thus making the hacked funds harder to track.
In an official Telegram channel, BitMart representatives initially claimed that the outflows were routine withdrawals, referring to the reports of the hack as “fake news.”
Hours later, however, BitMart CEO Sheldon Xia confirmed that the outflows were indeed a hack resulting from a “security breach.”
How Did It Conclude?
During investigation, it was found that it is a straightforward case of transfer, swap, and wash hacking, according to the security firm, Peckshield. Other investigation reports mentioned that the affected hot wallets were carrying only a small percentage of the company's assets.
Moreover, it was found that after transferring the funds from BitMart, the hackers used a decentralized exchange platform, known as 1inch, to exchange stolen tokens with Ether. These coins were then deposited into an address using a coin mixer called Tornado cash. Therefore, It became impossible to trace the receiving address.
Impact of the Bitmart Hack on the Crypto Community
After the BitMart hack, the trust level of the investors shook dramatically. Due to this reason, the trading platform turned towards an offline storage system where up to 54% of its tokens are stored in cold wallets.
Authorities all over the world are making continuous efforts to stabilize the cryptocurrency market and make the security systems strong. Another point to note is that even though blockchain is secure, the exchanges are not. Therefore, investors should use cold wallets to keep their funds Instead of relying on the vulnerable security system of crypto exchanges.
Bottom Line
Measures should be taken on both individual and exchange level to protect funds from crypto scams and hacks. This article was about what is the Bitmart hack.
