Upbit Exchange Hack Confirmed, $50M in Ethereum (ETH) Withdrawn

Rumors of an Upbit hack were confirmed, as this morning’s “whale” transaction of ETH turned out to be one of the largest heists in 2019.

The Korean exchange Upbit has been hacked, with rumors confirmed from multiple sources. The rumors from this morning happened after a large-scale transaction of Ethereum (ETH) was noted to come out of the exchange.

https://twitter.com/whale_alert/status/1199632731661099008

The ETH transfer happened without a warning that Upbit was switching cold wallets, and worried the entire community. The sum stolen is significant, comparable to half of the haul of Plus Token, and to some of the biggest ETH losses in history.

Binance’s CEO Changpeng “CZ” Zhao also announced the market operator would cooperate and freeze any funds related to the Upbit hack, which find their way into Binance.

Upbit confirmed the hack, and the wallet to which the funds were sent is being watched. The sum has not been moved yet, but several small “dust” transactions were received, possibly for tracking purposes.

The only funds stolen were in ETH, with the rest of the bulk transactions originating from Upbit not a part of the heist. The exchange moved all other assets from hot to cold wallets, and will close withdrawals for at least two weeks.

Upbit will cover the losses with its own funds, at above $51.2 million, or around 58 billion Korean won. Additionally, the exchange has warned against depositing ETH to the address from which the funds were taken.

The hack occurred at a moment when the Upbit exchange warned of a maintenance period, in which large-scale transactions would be the norm. The sum was moved at a time when withdrawals were closed, and initially mimicked a transfer to a cold wallet. There are also suspicions the heist could be an inside theft.

https://twitter.com/iamjosephyoung/status/1199616934829932545

The Upbit withdrawal for now does not have a clear reason, and so far the exchange has not shared details on how the private keys were obtained.

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