Update: ICORating Names the Most Secured Crypto Exchange

ICORating team has updated their Exchange Security Report analyzing security levels for crypto exchanges. For the second time, Kraken is ranked first and was protected from most attacks


The agency gives assessment to 135 selected crypto-exchanges whose daily trade value exceeds $100,000. Here are the most interesting points of the research:

  • Kraken is ranked first
  • Coinbase, which occupied the top spot, is out of the Top-5, while Binance lost its spot in the Top-20
  • Only 16% of exchanges fall into the A category of the security rating.
  • None of the exchanges have received an A+ rating
  • 74% exchanges were protected from DoS attacks

A PDF version of the report is available here.

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Cryptopia Hacker Moves Stolen Crypto to Binance; Community Alerts CZ and Funds Are Frozen

It is clear that hackers gave themselves a place to stay in the cryptocurrency industry, which was only made more evident by a recent security breach that happened over the last few days. Cryptopia, a leading exchange in New Zealand, announced a breach that ended in a major theft on January 14th. However, unlike the unfortunate tale that many other exchanges succumb to, that is not the end of the story. The official statement notes that Cryptopia has placed itself into a maintenance mode, helping them to protect their accounts until the regulatory authorities of New Zealand provide other details. Both the High Tech Crimes Unit and the local police are pursuing investigative efforts, though they have commented that “a significant value of cryptocurrency may be involved.” At this point, the actual amount has not been released, and no substantial details have been provided. Still, that has not stopped local news portal Radionz from reporting that the loss is close to $3.6 million. A Twitter user, ShaftedTangu, seems to know where these digital assets are going. On the posts, the user said, Hey @cz_binance Binance has stolen tokens from Topia hitting it sir. Can you lock it down? https://t.co/0XllsBejUV — I Dream Of Alts (@ShaftedTangu) January 16, 2019 Through a string of additional tweets, the user continued to track the funds, as he mentioned wallet address 0x9007a0421145b06a0345d55a8c0f0327f62a2224. In another tweet, he claimed, “Currently the 0x900 wallet contains around $10 mil USD of tokens, large amounts are $PRL $2mil, $CENNZ $1.168 mil, $Denacoin $2.73 mil, $MSP $0.99 mil” Luckily, just under four hours after the original tweet, CZ Binance replied. The reply said, Just checked, we were able to freeze some of the funds. I don't understand why the hackers keep sending to Binance. Social media will be pretty fast to report it, and we will freeze it. It's a high risk maneuver for them. https://t.co/i0PeahLzic — CZ Binance (@cz_binance) January 16, 2019 With such a nonchalant type of reply, it is quite a victory for Cryptopia and Binance that the funds could be frozen at all. However, the victory has not been won yet, considering there is no indication of exactly who performed the hack in the first place. Cryptopia has remained silent, though they posted to their own Twitter profile, saying, “We cannot comment as this matter is now in the hands of the appropriate authorities. We will update you as soon as we can.” As a result of these issues, Zhao posted that users should keep their holdings on exchanges, rather than a hardware wallet. However, his post caused an onslaught of negative replies, with some saying that his post implied that self-storage is substantially riskier than storing on a seemingly “reputable” exchange. Zhao later retracted, saying that he was not advising investors to store funds on exchanges. In the first half of 2018 last year, there was over $731 million lost in thefts involving exchange hacks. However, none have reached the severity experienced by the 2014 Mt. Gox hack.
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Binance Freezes ‘Some of the Funds’ Stolen in Cryptopia Hack

Some of the stolen cryptocurrency from yesterday’s Cryptopia hack has been sent to Binance, which has confirmed already freezing some of the funds.  Binance Freezing Funds Stolen from Cryptopia Twitter account @ShaftedTangu has alleged that some funds stolen as a result of Cryptopia’s hack have been siphoned through Binance. The amounts sent to Binance in question include roughly $7,500 in Metal (MTL) 00, $6,750 in KyberNetwork coin (KNC) 00, $7,181 OmiseGO tokens (OMG) 00, and $8,724 in EnjinCoin (ENJ) 00. All of it totals around $30,000. Changpeng Zhao, CEO at Binance – the world’s largest cryptocurrency exchange by means of traded volumes, has confirmed the allegations, reassuring that they’ve already frozen some of the funds. Zhao commented: Just checked, we were able to freeze some of the funds. I don’t understand why the hackers keep sending to Binance. Social media will be pretty fast to report it, and we will freeze it. It’s a high-risk maneuver for them. Just checked, we were able to freeze some of the funds. I don't understand why the hackers keep sending to Binance. Social media will be pretty fast to report it, and we will freeze it. It's a high risk maneuver for them. https://t.co/i0PeahLzic — CZ Binance (@cz_binance) January 16, 2019 Bitcoinist reported yesterday that Cryptopia’s security has been breached, resulting in ‘significant losses’. Police in New Zealand also confirmed. Binance Caught in the Fire Zhao’s tweet caused a reaction in crypto Twitter’s community as one user (@Crypto_Bitlord) expressed his bewilderment that Zhao referred to “social media” as a means of reporting rather than Binance’s own surveillance systems. I’m genuinely shocked stolen funds from @Cryptopia_NZ have easily passed through @binance UNDETECTED until social media flagged them. This raises some big questions. How is that possible with modern blockchain analysis? — Sir Bitlord (@Crypto_Bitlord) January 16, 2019 On the matter, Binance’s CEO said: It’s quite easy to generate a brand new address. We (and no one) recognize every transaction out there. We already have very in-depth and detailed blockchain analysis. Yet, the question remains – if a regular Twitter user has been able to detect the transaction in question, how, and more importantly – why did Binance miss it? Perhaps the better question, as posed by @Crypto_Bitlord is: So you are saying criminals can steal funds and just create a brand new address to send to before binance? In the meantime, Binance announced today the launch of their Binance Jersey fiat exchange. The platform is aimed at traders from Europe and it offers BTC/GBP, ETH/GBP, BTC/EUR, and ETH/EUR trading pairs. What do you think of Binance missing the transactions in question? Don’t hesitate to let us know in the comments below! Images courtesy of Shutterstock The post Binance Freezes ‘Some of the Funds’ Stolen in Cryptopia Hack appeared first on Bitcoinist.com.
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Binance Freezes Hacked Cryptopia Funds, Raises Questions Around Cryptocurrency Fungibility

Part of the funds from the Crytopia hack were recently sent to the Binance cryptocurrency exchange. In response, Changpeng Zhao (CZ), the CEO of Binance froze the funds, raising questions around cryptocurrency’s anonymity and fungibility. Cryptopia is a tiny exchange with a daily trading volume averaging around $2 million. The exchange was hacked on the evening of Jan. 13th for an estimated $3.5 million in cryptocurrency. The company announced the hack on Jan. 15th. Now, the hackers are likely looking for ways to launder, convert, and obfuscate the source of these funds. Especially now that authorities in New Zealand are involved. As part of this process, the hackers sent 31,320 Metal (MTL) ERC20 tokens to Binance. Trading at approximately $0.24 at press time, this amounts to roughly $7,500 in stolen cryptocurrency. After receiving a tip-off on Twitter, Changpeng Zhao immediately froze the funds: Just checked, we were able to freeze some of the funds. I don't understand why the hackers keep sending to Binance. Social media will be pretty fast to report it, and we will freeze it. It's a high risk maneuver for them. https://t.co/i0PeahLzic — CZ Binance (@cz_binance) January 16, 2019 Implications for Fungibility Fungibility, as it applies to cryptocurrency, is the concept that any given coin is identical and substitutable for any other coin in the same denomination. To give a non-cryptocurrency example, an ounce of pure gold is equivalent to any other ounce of pure gold. Correspondingly, someone might think that one bitcoin is equivalent to any other bitcoin. The problem boils down to traceability. If that bitcoin is tainted with money laundering or criminal activity, then it is not equivalent in terms of value or utility to another ‘clean’ bitcoin. Since the blockchain ledger provides a transaction history, that bitcoin could be traced back to some criminal activity. If involved in criminal activity, those funds could get blacklisted or result in legal consequences for any future receiver. Frozen Funds Demonstrate Non-Fungibility There is no doubt that freezing the hackers’ funds were justified. Exchanges should collaborate to inhibit illegal activity and make it as difficult as possible to engage in harmful criminal behavior. Yet, the very fact that Binance was able to identify the stolen funds and freeze them at all could be cause for broader concern. If someone receives $20 in cash, the previous owners of that cash are largely untraceable. If someone receives $20 in bitcoin, all previous wallet addresses attached to that transaction are visible. And, if bitcoin is treated as a commodity, then this could have interesting legal ramifications. If someone unknowingly receives illicit funds, how will law enforcement treat these cases, and who does the onus for checking fall on? For other commodities, if stolen goods are purchased unknowingly, law enforcement has the right to seize those goods and return them to the original owner. Those who intend to resell goods have an even higher responsibility to evaluate whether purchased goods are stolen. Yet, it’s still unclear whether exchanges, businesses, and individuals need to go through these processes. If they do, it introduces yet another complication and cost for transacting in cryptocurrency. Potential Solutions Privacy coins such as Monero and Zcash offer one potential solution: using technology to obfuscate transaction history. But, both of these coins need to catch up to the network effects already established by Bitcoin and Ethereum—which are already accepted at a larger, albeit still limited—number of vendors. Moreover, there is still a non-zero risk that regulators succumb to the public perception that these coins are used by “criminals and tax-evaders,” and place a blanket ban on privacy coins. Other ways crypto users have tried to limit personal liability include maintaining anonymity between wallet addresses and personal identification, using new wallet addresses for each transaction, using cryptocurrency mixers, washing coins in a loosely regulated exchange, and other systematic ways for obfuscating the transaction history of funds before making a purchase. Whether these activities fall into a legal gray area is another question. There still isn’t a clear solution to the issues of fungibility. Until then, it is likely that regulators and law enforcement will set a clearer precedent through doled-out enforcement actions. The post Binance Freezes Hacked Cryptopia Funds, Raises Questions Around Cryptocurrency Fungibility appeared first on CryptoSlate.
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