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Cryptocurrency Exchange Gemini Settles With IRA Financial Trust Over $36 Million Hack in 2022: Report
Cryptocurrency exchange Gemini and self-directed retirement and pension account platform IRA Financial Trust (IRA) have reportedly reached an agreement to settle a lawsuit stemming from a 2022 cyberattack.
The IRA sued Gemini after the cryptocurrency exchange suffered a security breach in February 2022.
The company says $36 million in client assets held by Gemini were lost due to the cybersecurity incident.
In its trial, the IRA alleged that the flight should not have happened if Gemini’s claims that it had strong security capabilities were true.
“Contrary to Gemini’s claims about security, Gemini designed its API (application programming interface) with a single point of failure. In the event of a breach, this single point of failure would allow a malicious actor to steal all of the crypto assets held by an institutional client’s clients, such as an IRA.”
The IRA also claimed it had to alert Gemini because the exchange did not immediately protect the involved accounts after the incident.
“The IRA did not have the ability to freeze crypto accounts. So once the IRA discovered the hack, it had to send frantic emails to Gemini — over and over again — to get all the accounts frozen. It took six emails from the IRA and nearly two hours for Gemini to freeze all the customer accounts. In the meantime, millions of dollars in crypto assets were stolen.”
Two years later, Gemini and IRA would have agreement concluded According to the legal news service Law360, federal judge Analisa Torres approved on Thursday a stipulation of dismissal that both sides reached to close the case.
Details of the deal have not yet been disclosed.
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