Security Issue of Digital Currency
In June, South Korea's largest bitcoin exchange Bithumb had a loss estimated at 4 billion won (US$3.56 million) due to personal information leakage. Recently, there were also hacking attempts on other digital currency exchanges such as Coinone and Korbit.
According to industry sources on August 30, hackers recently tried to open an account in Coinone with 10,000 e-mail addresses collected through the Internet at random without permission. It is possible to open an account in Coinone when users enter their e-mail addresses and passwords.
An official from Coinone said, “There were random attempts to join Coinone through e-mail addresses for two days from the 27th and the 28th. The accurate purpose is not confirmed yet but we believe they were part of distributed denial of service (DDoS) attacks.”
However, Coinone said there are no actual financial damages because users need to verify themselves through cellphone number, account number and one-time password (OTP) to deposit and withdraw money. Fortunately, the hacking attempts didn’t cause any damages but Coinone customers were concerned if the Bithumb incident reoccur. Accordingly, Coinone will suspend the use of or close the accounts that were opened randomly through e-mail addresses after the review.
In addition, an increasing number of voice phishing cases, which impersonates Korbit, Coinone and Bithumb, are reported as well as only direct hacking attempts on digital currency exchanges. As digital currency transactions are showing a rapid growth in size, crimes such as hacking and voice phishing schemes are also on the rise.
Some say there is a growing unease among investors as there is lack of a legal basis and security level of digital currency exchanges despite concerns over such crimes. Under the current law, digital currency exchanges are registered as communication service providers that has only to their businesses so financial authorities don’t have the right of direct supervision.