Yesterday night two large sums have been sent from Coincheck exchange wallet to an unknown address. 100 mln USD through Ripple and 532 mln USD through NEM. They were quick to take the easy way out and have stated that they have been hacked and that all withdrawals and deposits are currently unavailable. How convenient and believable. Isn't it?
Did Coincheck rip-off it's users or did they actually got hacked? I doubt the hack, but either way, it's their fault and it further proves what I'm trying to tell others and that is the dangers and unreliability of centralized exchanges.
Read through the alleged hack situation Coincheck want's the public to believe and see if it reminds you of a certain situation from the past.
And so it was in this case, as once again people need to get burned before they can learn from their mistakes and move to safer, decentralized exchanges like Bitshares.
How it went down
- Everything started with a suspicious transfer of 100 mln USD worth of XRP to an unknown account that has a 3 bln USD balance.
- Followed up by Coincheck reporting the likely "fraudalent" transfer of $532 mln worth of NEM to the Financial Services Authority and the Police. The transfer is clearly visible in NEM's graph as seen from a huge volume spike while pushing the price down about 15%.
The NEM Foundation president Lon Wong has appeared to confirm Coincheck was hacked, calling the stolen funds "the biggest theft in the history of the world."
In a statement to CoinDesk, Lon Wong, president of the NEM.io Foundation, said there are no issues with its network, saying:
As far as NEM is concerned, tech is intact. We are not forking. Also, we would advise all exchanges to make use of our multi-signature smart contract which is among the best in the landscape.
Then came the restriction as Coincheck slowly began to ban cryptocurrency trading and withdrawals. Starting from NEX and XRP and later deciding to ban cryptocurrency withdrawals in general, both fiat and crypto.
“All withdrawals from the platform are currently restricted, including JPY. Thank you for your understanding. We are doing our utmost to resume normal operations as soon as possible,” the most recent update to the blog post reads.
Rings a bell? If not read through this article for a little Déjà-vu and a wake up call to move all of your coins from centralized exchanges to decentralized ones.
I can't get it why people still use centralized exchanges, not knowing they can lose all of their funds in a minute. If an exchange decides to steal all the funds on it's wallets, there is nothing stopping them from doing it and stating and faking that they got hacked.
Hoping more will learn the lesson this time, even though they lost money and will probably never get it back, it's a lesson they had to learn the hard way because, as I stated before:
Some people only learn when they get burned.
It was like that when I was warning people about "lending platforms" and it's the same with centralized exchanges.
Not sure how many "hacks" and lost funds need to happen before you wake up, but I'm hoping that this post will be an eye-opener for many and that you are going to learn from this and never trust centralized exchanges once again and finally start using Bitshares