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Exchange Site Bitcoinica Hacked, US$90,000 Stolen

Bianca STANESCU

May 15, 2012

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Exchange Site Bitcoinica Hacked, US$90,000 Stolen

Bitcoins valued at 90,000 dollars were stolen in a security breach at Bitcoin exchange site Bitcoinica, according to a site representative. Hackers compromised one of the team members` email servers and then hijacked 18,547 Bitcoins from the online wallet. The company has suspended operations to focus on the investigation.

In the attack last Friday, the database was most likely compromised. This included information such as usernames, email addresses, and account histories, along with encrypted passwords. “The thief stole from us not you. All withdrawal requests will be honored,” Bitcoinica representatives announced in a statement.

The company also advised clients to change passwords if they have reused them on different online services. “Users should be especially suspicious of any emails received to your Bitcoinica email address. It is always a best practice to never click an email link to login to any online service,” they said.

In the meantime, the company`s founder Zhou Tong announced his retirement. “I’m leaving Bitcoin. No, this isn’t related to the Bitcoinica hack. The hack just makes the choices obvious and straightforward,” Zhou Tong said on a forum. “I leave Bitcoin only because it doesn’t help address my real needs. Making money isn’t that important after all.”

He also acknowledged the hacking is “more serious” than initially thought. “Likely we will either shut down the platform or re-develop entirely (which will take months instead of days),” Bitcoinica`s founder said.

This is not the first time the company has dealt with a cyber-attack. A couple of months ago, hackers stole 43,000 Bitcoins after breaking into the Linux cloud provider Linode. Attackers breached a Web-based customer service portal used by the company and emptied the Bitcoin accounts of eight clients. One of them reported his stolen Bitcoins valued around $14,000.

Bitcoin is an experimental digital currency that enables instant payments to anyone, anywhere in the world. The exchange uses peer-to-peer technology and doesn`t operate with any central payment authority.

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