Bithumb Says it Halved its Losses From Latest Breach

South Korea's second-largest exchange just published a report in which it announced that it recovered some of the sum stolen by hackers.

In a report published today, Bithumb assured its customers that it managed to recover almost half the funds that it lost as a result of the June 20 breach, reducing its overall USD losses to around $17 million.

“Bithumb reported that the amount of damage caused by cyber-attack was about 35 billion KRW. However, after having undergone a continuous recovery process, we come to conclusion [sic] that the actual damage is about 19 billion KRW instead,” the exchange announced.

According to Bithumb, this recovery was largely due to collaboration from other cryptocurrency exchanges that tracked down the hackers’ activities and ensuring that the funds were returned to their original wallets. It also said that the rapid movement of coins from its hot wallet into cold storage helped to quell any damage.

The reasoning that the exchange provides confirms reports that it was moving enormous sums of Bitcoin to a single wallet with exorbitant transaction fees. The consolidation effort was one of the reasons why the Bitcoin network was congested in the hours following the breach.

Bithumb paid a whopping 0.1 BTC transaction fee for most of its movements, converting to around $661 at the time. This was true even for small sums like 0.3 BTC, costing the exchange about a third of the sum that was transferred in the first place just in fees.

Along with an apology for the inconvenience that the breach may have caused some of the traders that used the platform, Bithumb also announced that it would be airdropping coins to those affected by the hack, adding an annual interest rate of 10% “over the period of the event.” This appears to be an attempt to incentivize holding coins instead of moving them off of the exchange.

After dropping in trading volume significantly because of the freeze, Bithumb will certainly need all the customers it can retain to move forward with recovery efforts.