.One of Asia's largest crypto exchanges has abruptly frozen all clients' withdrawals this week due to a cyberattack. Singapore's fiat-cryptocurrency platform Coinhako was targeted on February 21 in what the company described as a "sophisticated attack."
Before it announced the attack, the exchange said some functions were paused while it underwent "unplanned maintenance."
Coinhako CEO Yusho Liu told CoinDesk that, following the outage, the exchange had reset passwords and two-factor authentication for all users, but the ability to withdraw funds would remain restricted as a "key countermeasure against unauthorized transaction outflows."
A Coinhako spokesman also explained on Telegram that they have detected "a sophisticated and coordinated attack" on specific Coinhako accounts, and thus the exchange has "disabled the send function as a preventive measure."
Security has been an issue for Asian exchanges
The attack, however, only impacted 20 Coinhako users and trading operations, user accounts, and their associated funds/account balances were not at risk at any point during the attack, the exchange confirmed. Several days after the attack, the exchange assured affected customers that they will be reimbursed from its own pocket.
On 21st Feb 2020, our system was quick to detect transactional anomalies. This allowed us to react and keep affected parties low.
Affected parties have been fully reimbursed and here is an overview of the incident ?? Join Telegram for more info https://t.co/y2TAdAyLLZ#coinhako pic.twitter.com/xBAAhfgsHb — Coinhako (@coinhako) February 27, 2020
Anxious traders responded to the company tweet in the hopes that the exchange had not been hacked, and no balances were lost. Some clients who reported that their deposits were pending for hours were reassured by the company.
Coinhako is one of the oldest crypto exchanges in Asia, and its operations are heavily focused on Singapore, Malaysia, Indonesia, and Vietnam. It supports more than 25 Cryptocurrencies and up to 100 fiat-crypto pairings. The exchange allows users to make multiple transactions - ranging from FX exchanges, crypto to crypto exchanges, and moving tokens across different platforms.
Security has been an issue for Asian crypto exchanges in particular. In 2018, hackers stole about $500 million worth of a lesser-known cryptocurrency called NEM coins from major Japanese exchange Coincheck. Tokyo-based Mt. Gox was the first high-profile hack. To date, CEO of the now-defunct Bitcoin exchange Karpelès has denied any wrongdoing and blamed hackers for the lost bitcoins, pointing to a software security flaw.
