Bitgrail CEO Ordered to Pay $170M He Claims Lost to Hackers

Cryptocurrency Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term Bitgrail’s CEO Francesco Firano, aka The Bomber, has been ordered to pay back thousands of investors he claims hackers bilked out of $170 million worth of cryptocurrency.

An Italian court previously seized the controversial company’s remaining assets, which are managed by a special administrator, and ruled that BitGrail must remain closed while its bankruptcy proceedings progress.

BitGrail is an Italian cryptocurrency exchange which is best known for being hacked of $170 million in Nano (formerly Raiblocks). While there were red flags for weeks leading up to the hack, Nano and Firano blamed each other for the theft and disagreed about how to deal with the aftermath.

The Nano development team strongly denied that their software is affected by any vulnerabilities to which Firano referred. Moreover, they claimed that BitGrail was holding XRB in a different kind of wallet to other coins, which left it vulnerable. In turn, Firano claimed that the Nano network itself was flawed, and if their team was to undergo a hard Fork Fork A fork can occur when a blockchain diverges into two potential paths forward, there is a change in protocol, or a scenario occurs in which two or more blocks have the same block height.Because blockchain networks are decentralized, the participants on the network must come to an agreement when it comes to things like software upgrades to a network. This is called consensus.When consensus cannot be achieved on a software upgrade, a fork occurs, effectively representing a divergence in software th A fork can occur when a blockchain diverges into two potential paths forward, there is a change in protocol, or a scenario occurs in which two or more blocks have the same block height.Because blockchain networks are decentralized, the participants on the network must come to an agreement when it comes to things like software upgrades to a network. This is called consensus.When consensus cannot be achieved on a software upgrade, a fork occurs, effectively representing a divergence in software th Read this Term the money could be recovered. Nano disagreed and said that it would finance the legal expenses of the victims.

A remarkable precedent

The story developed when Nano became the first crypto firm to face legal action by investors seeking to force a hard fork to recover their money.

Making matters worse, Firano suggested a repayment scheme to be funded by a re-opened BitGrail. He did not admit that his exchange was at fault despite evidence surfacing that it was his mismanagement that caused and exacerbated the security vulnerabilities of the site.

Following this, a group of victims filed a petition requesting that BitGrail declare bankruptcy. At the beginning of March 2018, Firano attempted to reopen the exchange, but within three hours it had been shut down again by the court which approved the precautionary suspension request of the law firm representing the 3,000 clients.