The $31 Million Cryptocurrency Hack

The $31 Million Crytocurrency Hack

On November 21, Tether announced via their official website that an external attacker hacked into their system two days prior and stole $30,950,010 worth of tokens from their treasury wallet. The tokens were then moved to an unauthorized address. Tether, a startup and key player of the cryptocurrency market, takes pride in their stable currency and the fact that every 1 token is equivalent to $1 US.

Tether takes action

According to the announcement, Tether acted as soon as it learned what transpired. The company flagged the tokens as non-redeemable in order to prevent anyone from using them. Tether also suspended its back-end wallet service while the cyberattack is being investigated.

To stop the tokens from being redeemed, Tether made Omni Core updates available to all its users. Omni Core, an open-source software designed for cryptocurrency, is what the company uses to support its transactions. Tether posted a link of the updates on their announcement and advised its community to download them at once.

With the software updates, Tether advised that users will not be able to accept tokens being sent from the unauthorized address, thereby preventing the tokens from moving outside it.

Tether is teaming up with the Omni Foundation (Omni Core parent company) on how the stolen tokens can be returned to Tether’s treasury wallet. Upon completion of the investigation and recovery of the tokens, Tether will provide additional software updates to return things to normal.

Aftermath of the hack

Tether stated that its normal operations have not been affected much. Aside from the stolen tokens, all other tokens are redeemable and still backed by its reserves. The company will continue to update its community regarding the case.

The rest of the cryptocurrency ecosystem, however, was thrown into chaos. Values of Bitcoin and Ethereum nosedived as news of the Tether attack broke, and confidence in the security of current cryptocurrency systems took a major hit.

Prior to the announcement, Bitcoin’s value was experiencing a record high with a price of more than $8,200. Once the incident was made public, prices fell to $7,827. On the same day, Ethereum was valued at around $372. It then dipped to a little over $350 after the hack.

Bitcoin was quick to get back up, though. The cryptocurrency pioneer has since recovered its losses by posting a value of $8,339 in trading. The effects of the hack seem to have been short-lived for the company.

Cryptocurrency and ransomware

A type of attack that leverages cryptocurrency is ransomware. It’s when a cybercriminal inserts malware into your system (a typical method is phishing emails)  and threatens to either lock you out, destroy your data, or publish it until you pay a ransom, usually through Bitcoin and other virtual currencies.

Ransomware attacks have increased exponentially over the past couple of years. There were more than 400,000 ransomware detections made in 2016 alone. A string of high-profile and large-scale ransomware attacks have already occurred in 2017.

Hotspot Shield is your defense

These attacks don’t mean you have to be vulnerable. In addition to being vigilant and being careful not to open suspicious emails, you can protect yourself with Hotspot Shield.

Hotspot Shield is a high-quality Virtual Private Network (VPN) software that enables you to remain invisible on the internet. This means cybercriminals will not be able to see you, access your data, or attack your system.

Secure your information today. Visit our website to download Hotspot Shield VPN. It’s available for free on Windows, Mac OS, Android, and iOS. You can also check out our blog for the latest cybersecurity news.

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