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Bancor Platform Goes Offline Amid ‘Security Breach’ Reportedly Involving Over $12 Mln

By on July 10th, 2018 at 7:38 am UTC · 3 min read

Bancor, Zug-based decentralized exchange, suffered a hack. It was exploited to steal $12.5 million in ETH, $1 million worth of NPXS and $10 million worth of BNT.

Altcoins, Blockchain News, Crimes, Cryptocurrency News, Ethereum (ETH)
Photo: Bancor Maintenance
Photo: Bancor Maintenance
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Bancor, decentralized cryptocurrency exchange based in Zug, Switzerland, shut down on Monday morning as a result of a “security breach.”A few hours after the attack, the company issued a follow-up statement on its Twitter.

Bancor is a decentralized liquidity network that provides users with a simple, low-cost way to buy and sell tokens. Bancor’s open-source protocol empowers tokens with built-in convertibility directly via their smart contracts and allows integrated tokens to be instantly converted for one another. It doesn’t have to match buyers and sellers in an exchange. The Bancor Wallet enables automated token conversions directly from within the wallet, at prices more predictable than exchanges and resistant to manipulation.

Before announcing the attack, Bancor said its Web App was paused for unplanned maintenance.

The company is currently investigating the nature of the incident. According to Bancor, the attack only had impact on trading operations, and user accounts and their associated funds/account balances were not at risk. Bancor estimated the damage and stated that a vulnerability was exploited to steal 24,984 ETH ($12.5 million), $1 million worth of NPXS and $10 million worth of BNT.

The company said:

“We were able to freeze the stolen BNT, limiting the damage to the Bancor ecosystem from the theft. The ability to freeze tokens was built into the Bancor Protocol to be used in an extreme situation to recover from a security breach, allowing Bancor to effectively stop the thief from running away with the stolen tokens.”

Speaking of the theft of the other cryptocurrencies, Bancor noted that “it is not possible to freeze the ETH or any other stolen tokens.”

Nate  Hindman, Bancor’s head of communications, said that Bancor is expected to go back online in the next 24 hours.  “We will continue to post updates as and when appropriate on our Telegram channel and on Twitter,” he explained.

Last year, Bancor, which operates as an open-source protocol for automated token conversions, raised approximately $153 million in ICO. In January of this year, Bancor challenged users to find bugs and mistakes in its wallet security ahead of Bancor Wallet launch. However, the hacking incident is likely to reinforce doubts about Bancor’s prospects.

The Monday’s attack is not the first example of crooks targeting digital token companies. Recently, a South Korean cryptocurrency exchange Coinrail announced it had been a victim of a hacking attempt. Another South Korean crypto exchange Bithumb lost $30 million worth of undisclosed cryptocurrencies as a result of a hack in June.

Daria Rud
Author: Daria Rud

Daria is an economic student interested in the development of modern technologies. She is eager to know as much as possible about cryptos as she believes they can change our view on finance and the world in general.

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