DeFi
UK crypto exchange ceases trading after losing $22 million in ‘security incident’ – DL News
- Lykke says someone gained “unauthorized access” to the exchange.
- Onchain detective SomaXBT claims the exchange was hacked.
- Depositors cannot withdraw from the platform, but Lykke claims funds are safe.
In the latest sign that crypto hackers are exploiting private keys, Lykke, a UK-based crypto exchange, halted trading on June 6, citing “unauthorized access” to its platform.
The closing occurred two days after the exchange pirateaccording to SomaXBT, a web researcher, who was the first to report the incident.
The exchange was maintained $22 million in suspicious outputs, said Taylor Monahan, MetaMask developer and crypto defense expert.
Unable to withdraw
Lykke has seen a cumulative volume of $2.5 million over the past month. Its users are currently unable to withdraw their assets from the platform, with several reporting that their account balances have been emptied – another sign that the exchange may have been hacked.
According to Onchain data, half of the sum was in Bitcoin and the rest was a mix of Ether, Litecoin and Bitcoin Cash.
On-chain data too watch the Ether removed from the exchange was immediately exchanged for the stablecoin DAI, issued by MakerDAO.
At the same time, the stolen Bitcoins were spread across multiple wallets – a common tactic used by hackers to obscure the transaction trail when trying to launder stolen funds.
The exchange was largely silent on the incident. On June 6, b Lykke CEO Richard Olsen apologized for the platform’s downtime in an email to customers.
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Security incident
“We are still investigating the causes of this security incident,” Olsen said in the email seen by DL News.
“In the meantime, you can rest assured that your funds are safe,” Olsen said. “Lykke is a diversified company with strong capital reserves. »
The exchange website currently displays a message stating that the platform is “under security maintenance” and will remain “inactive for further notice”.
Lykke did not immediately respond to DL News’ requests for comments.
Lykke is the second crypto exchange to be hacked in the past two weeks after DMM Bitcoin saw $320 million stolen from its platform on May 31.
Private key leak
With 2024 almost halfway there, crypto theft this year exceeded 582 million dollars, DefiLlama data watch.
This figure exceeds the $433 million recorded in the first half of last year.
Most of the biggest hacks this year were caused by a private key leak, a security issue identified by cybersecurity firm Cyvers. a major potential concern for crypto companies.
The first half of 2024 will see more cryptocurrency thefts than the same period last year.
Private keys function like passwords and control access to crypto wallets. If hackers gain control of a crypto company’s private keys, they can siphon off any funds it keeps in affected wallets.
Last year, Cyvers research found that 85% of the $900 million stolen from DeFi exchanges, bridges and protocols in the second half of the year was due to a private key leak.
Cyvers co-founder Meir Dolev previously said DL News The problem could become more endemic to crypto if industry players do not adopt security measures.
The DMM Bitcoin hack, this year’s largest crypto theft so far, has been traced to a private key leak.
Onchain detectives say the Lykke security breach has similar characteristics.
Osato Avan-Nomayo is our DeFi correspondent based in Nigeria. He covers DeFi and technology. To share tips or story information, please contact him at osato@dlnews.com.