Following a $28 million hot wallet attack on Nov.1, cryptocurrency derivatives exchange Deribit has stopped accepting withdrawals.
Before 00:00 UTC on November 1, Deribit exchange’s hot wallet was compromised, the company announced on Twitter. The exchange highlighted that client assets are secure because Deribit’s reserves cover losses, saying:
“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.”
Deribit has to restrict withdrawals as part of ongoing security tests, including those from custodians Copper Clearloop and Cobo, until the exchange is completely confident in security in the wake of the incident. Deposits that have already been sent will still be processed and credited to accounts once the necessary amount of confirmations has been received, the company noted.
The information in Deribit’s Telegram channel indicates that trade is going on normally. A Deribit support representative said, “Thanks to our hot wallet policy, we were able to limit the loss of user funds.”
The hack won’t have an impact on Deribit’s insurance money because the exchange will cover the loss as well. The statement states that “Deribit remains in a financially sound position and continuing activities will not be harmed.”
According to a Deribit spokeswoman, the corporation is currently reviewing “all security measures” in order to restore withdrawals as soon as feasible. In order to provide further information regarding the vulnerability that might have led to the problem, the platform is currently embarking on a comprehensive incident review, the source continued.
Since the company’s founding, Deribit had never been subject to such an attack or suffered damages, according to the spokesman.
About Deribit
Deribit, one of the biggest cryptocurrency derivatives exchanges in the world, was founded in 2016 and lets customers trade cryptocurrency futures and options. Deribit has $280 million worth of daily trade activity as of this writing, according to information from CoinGecko.
Several Deribit’s website sections likewise seem to be inactive as of this writing. When accessed at the time of writing, Deribit Insights, the company’s crypto data hub, displayed a “major issue on this website.”
Deribit’s trading website is still operational in the interim. A Deribit spokesperson claims that there is no connection between the website malfunction and the hack.
