BitMart to compensate crypto traders after $ 200 million loss

The centralized crypto exchange BitMart , which was hacked over the weekend and suffered an estimated $ 200 million loss in digital assets, has announced plans to compensate affected users and resume its operations activities.

Sheldon Xia , CEO of BitMart, revealed the news via a series of messages on Twitter , indicating that the exchange “has completed the initial security checks and identified the affected assets.” He added that the security breach was the result of a stolen private key that compromised two of the exchange’s hot wallets, insisting that the rest of the assets are safe.

Xia also disclosed that BitMart will compensate affected users, saying:

“We are also talking to multiple project teams to confirm the most reasonable solutions, such as token swaps. No user will be harmed.”

The CEO said he was “confident that the deposit and withdrawal functions will gradually resume on December 7, 2021.” He also aims to conduct an AMA (ask me anything) at 1 a.m. UTC on December 6 to share more information regarding the incident.

“We are currently doing our best to recover the security facilities and our operation. We need time to make the necessary arrangements and your understanding during this time will be greatly appreciated,” Xia tweeted.

Security analysis firm Peckshield has drawn attention to the unusual flow of funds out of BitMart, listing “assets transferred and their amounts”. The company noted that around $ 100 million was transferred from the Ethereum (ETH) blockchain and $ 96 million from Binance Smart Chain (BSC).

Following Peckshield’s advice, Bitmart admitted to identifying “a large-scale security breach”, adding that it has temporarily suspended withdrawals.

The hacker proceeded to exchange the stolen crypto-assets, which include a significant amount of memes like Dogecoin (DOGE) and Shiba inu (SHIB), for ETH using the decentralized exchange aggregator (DEX) 1inch .

The hacker also used the decentralized Tornado Cash mixer to keep transactions confidential, making it even more difficult to track stolen funds.

According to PeckShield, the hack was a “fairly straightforward case that involved the transfer of funds, their exchange and laundering.”

24-hour trading volume on BitMart is currently $ 1.15 billion, after falling $ 1.46 billion yesterday, according to data from Coingecko . The platform is now in 27th place in terms of daily volume.

Last week, the autonomous decentralized organization (DAO) Badger CAD had lost more than $ 120 million in an alleged attack on its front end. According to Etherescan’s transactions, one of the affected users lost approximately 897 WBTC (Wrapped BTC) (over $ 50 million) as a result of the hack. Reports claim the address belonged to Celsius Network (CEL), a major crypto lending company.