Gatecoin Hack - Revision history

Azoundria: 30 minutes. Improved the about section and completed a promotion on Twitter.

2024-05-10T22:53:00Z

30 minutes. Improved the about section and completed a promotion on Twitter.

Azoundria: 30 minutes. Integrated information from May 20th update into the Ultimate Outcome section. Integrated information from the Fintastico and SideProjector sites about Gatecoin. Added a screenshot. Added review summary from Unblock.net. Reviewed archive versions of Gatecoin website but nothing to add from them. Added information from May 28th Reddit/Twitter update, and merged with existing May 28th update information. Review and removal of empty timeline entries.

2024-04-26T19:53:47Z

30 minutes. Integrated information from May 20th update into the Ultimate Outcome section. Integrated information from the Fintastico and SideProjector sites about Gatecoin. Added a screenshot. Added review summary from Unblock.net. Reviewed archive versions of Gatecoin website but nothing to add from them. Added information from May 28th Reddit/Twitter update, and merged with existing May 28th update information. Review and removal of empty timeline entries.

Show changes

Azoundria: 30 minutes. Integrated infromation from Reddit thread. Gatecoin homepage information integrated better into the about section. Reviewed Twitter and added information on May 20th tweet/Reddit update.

2024-04-25T22:21:18Z

30 minutes. Integrated infromation from Reddit thread. Gatecoin homepage information integrated better into the about section. Reviewed Twitter and added information on May 20th tweet/Reddit update.

← Older revision		Revision as of 16:21, 25 April 2024
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	Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.		Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.

	This exchange or platform is based in Hong Kong, or the incident targeted people primarily in Hong Kong.~~<ref name=":10">[https://web.archive.org/web/20160505123951/https://gatecoin.com/ Gatecoin Homepage Archive May 5th, 2016 6:39:51 AM MDT] (Accessed Apr 18, 2024)</ref>~~<ref>https://twitter.com/search?q=(from%3AGatecoin)%20until%3A2016-06-01%20since%3A2016-05-06&src=typed_query~~</ref><ref>https://www.reddit.com/r/digix/comments/4ilk1p/comment/d2z4m5q/ (Accessed Apr 24, 2024)~~</ref>		This exchange or platform is based in Hong Kong, or the incident targeted people primarily in Hong Kong.<ref>https://twitter.com/search?q=(from%3AGatecoin)%20until%3A2016-06-01%20since%3A2016-05-06&src=typed_query</ref>

	== About Gatecoin ==		== About Gatecoin ==
	Founded and established in 2013 in Hong Kong, Gatecoin primarily focused on Bitcoin and Ethereum markets<ref name="thenextweb-16" />. In 2015, Gatecoin ~~recently~~ launched a new Bitcoin exchange ~~featuring~~ robust security measures<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. These measures include segregated client bank accounts, multi-signature cold storage, and continuous monitoring by an external IT security firm<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. The company emphasizes its commitment to regulatory compliance, operating under a Hong Kong Money Service Operator license and adhering to AML/KYC rules<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. Gatecoin's segregated bank accounts ensure that clients' funds are kept separate from operational expenses, minimizing counterparty risks<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>.		Founded and established in 2013 in Hong Kong, Gatecoin primarily focused on Bitcoin and Ethereum markets<ref name="thenextweb-16" />. Gatecoin was a regulated and secure financial institution specializing in blockchain assets<ref name=":10">[https://web.archive.org/web/20160505123951/https://gatecoin.com/ Gatecoin Homepage Archive May 5th, 2016 6:39:51 AM MDT] (Accessed Apr 18, 2024)</ref>. Gatecoin emphasized compliance and transparency, boasting KYC and AML processes supported by a major compliance solutions provider<ref name=":10" />. In 2015, Gatecoin launched a new Bitcoin exchange which featured robust security measures<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. These measures include segregated client bank accounts, multi-signature cold storage, and continuous monitoring by an external IT security firm<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. The company emphasizes its commitment to regulatory compliance, operating under a Hong Kong Money Service Operator license and adhering to AML/KYC rules<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. Gatecoin's segregated bank accounts ensure that clients' funds are kept separate from operational expenses, minimizing counterparty risks<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>.

	The exchange allows users to trade Bitcoin against USD, Euro, and HKD, with plans to integrate Ripple into its platform soon<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. ~~Additionally~~, ~~Gatecoin planned the introduction of a white~~-~~labeled debit card that could be reloaded instantly online using bitcoins~~, ~~providing users with~~ a ~~convenient way to spend their digital currency worldwide without incurring foreign transaction fees~~<ref name=":12">~~[https://cointelegraph~~.~~com/news/gatecoin-launches-bitcoin-~~exchange-~~with-~~segregated~~-bank-~~accounts ~~Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]~~</~~ref~~>. ~~Looking ahead from 2015~~, Gatecoin ~~expressed aims to expand its business to the US~~ and ~~Europe~~, ~~focusing on obtaining the necessary licenses~~ and ~~developing innovative digital currency trading services and payment methods to enhance user experience~~<ref name=":12"~~>[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]<~~/~~ref~~>.		The platform promises deep liquidity through a market maker rebate program and features an instant buy/sell option for seamless currency swaps<ref name=":10" />. The exchange allows users to trade Bitcoin against USD, Euro, and HKD, with plans to integrate Ripple into its platform soon<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. Users can easily buy and sell bitcoin, ether (Ethereum), and DAO tokens worldwide with various fiat currencies, benefiting from public live-data streaming, a fully documented REST API, and dedicated customer support<ref name=":10" />. The exchange's trading system is decentralized, modular, scalable, and highly secured, employing bank-grade security procedures and segregated client accounts<ref name=":10" />. Moreover, Gatecoin offers a smart and mobile-optimized interface for intuitive trading experiences, continually enhancing its platform for user convenience and efficiency<ref name=":10" />.

	Gatecoin is a regulated and secure financial institution specializing in blockchain assets<ref name=":10" />. Based in Hong Kong, the platform offers deep liquidity through a market maker rebate program and features an instant buy/sell option for seamless currency swaps. It provides advanced trading tools designed by professional brokers, ensuring access to innovative features and top-tier connectivity options. Gatecoin emphasizes compliance and transparency, boasting KYC and AML processes supported by a major compliance solutions provider. Users can easily buy and sell bitcoin, ether (Ethereum), and DAO tokens worldwide with various fiat currencies, benefiting from public live-data streaming, a fully documented REST API, and dedicated customer support. The exchange's trading system is decentralized, modular, scalable, and highly secured, employing bank-grade security procedures and segregated client accounts. Moreover, Gatecoin offers a smart and mobile-optimized interface for intuitive trading experiences, continually enhancing its platform for user convenience and efficiency<ref name=":10" />.		Aurélien Menant was the CEO of Gatecoin through 2015 and 2016<ref name=":0">[https://old.reddit.com/r/gatecoin/comments/4jb1la/official_statement_regarding_gatecoin_hot_wallet/ OFFICIAL STATEMENT REGARDING GATECOIN HOT WALLET BREACH - Reddit] (Accessed Apr 2, 2024)</ref>. Looking ahead from 2015, Gatecoin expressed aims to expand its business to the US and Europe, focusing on obtaining the necessary licenses and developing innovative digital currency trading services and payment methods to enhance user experience<ref name=":12" />. Gatecoin planned the introduction of a white-labeled debit card that could be reloaded instantly online using bitcoins, providing users with a convenient way to spend their digital currency worldwide without incurring foreign transaction fees<ref name=":12" />.

	Aurélien Menant was the CEO of Gatecoin through 2015 and 2016<ref name=":0">[https://old.reddit.com/r/gatecoin/comments/4jb1la/official_statement_regarding_gatecoin_hot_wallet/ OFFICIAL STATEMENT REGARDING GATECOIN HOT WALLET BREACH - Reddit] (Accessed Apr 2, 2024)</ref>.

	== The Reality ==		== The Reality ==
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	\|Palantine King Downtime Post		\|Palantine King Downtime Post
	\|Palantine King posts on their website noting that Gatecoin, a significant player in DGD trading volumes which they actively trade, abruptly went offline after displaying a maintenance page for an hour<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. Despite calls for tweet updates during the maintenance, none were provided, fueling speculation of a hack<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. While the hack remains unconfirmed, early indicatorsI suggest it as a likely scenario<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. Given Gatecoin's substantial role in DGD trading, the incident could have significant consequences for DGD's price, particularly if hackers engage in unbalanced selling<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. The situation is unfolding, and further updates are awaited<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>.		\|Palantine King posts on their website noting that Gatecoin, a significant player in DGD trading volumes which they actively trade, abruptly went offline after displaying a maintenance page for an hour<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. Despite calls for tweet updates during the maintenance, none were provided, fueling speculation of a hack<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. While the hack remains unconfirmed, early indicatorsI suggest it as a likely scenario<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. Given Gatecoin's substantial role in DGD trading, the incident could have significant consequences for DGD's price, particularly if hackers engage in unbalanced selling<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. The situation is unfolding, and further updates are awaited<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>.
			\|-
			\|May 9th, 2016 2:30:43 PM MDT
			\|Reddit Downtime Discussion
			\|Palantine King posts their concerns about the Gatecoin downtime on Reddit<ref name=":19">[https://old.reddit.com/r/digix/comments/4ilk1p/gatecoin_hacked/d2z4m5q/ Paletine King - Gatecoin hacked? - Reddit] (Accessed Apr 24, 2024)</ref>. One user expressed that they are also having trouble with a withdrawal which hasn't come through yet<ref name=":19">[https://old.reddit.com/r/digix/comments/4ilk1p/gatecoin_hacked/d2z4m5q/ Paletine King - Gatecoin hacked? - Reddit] (Accessed Apr 24, 2024)</ref>.
	\|-		\|-
	\|May 9th, 2016		\|May 9th, 2016
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	\|Homepage 404 Error		\|Homepage 404 Error
	\|The present homepage is captured displaying a 404 error<ref name=":11">[https://web.archive.org/web/20160518155002/http://gatecoin.com/ Gatecoin Homepage Archive May 18th, 2016 9:50:02 AM MDT] (Accessed Apr 18, 2024)</ref>.		\|The present homepage is captured displaying a 404 error<ref name=":11">[https://web.archive.org/web/20160518155002/http://gatecoin.com/ Gatecoin Homepage Archive May 18th, 2016 9:50:02 AM MDT] (Accessed Apr 18, 2024)</ref>.
			\|-
			\|May 20th, 2016 1:36:34 AM MDT
			\|Update Post Made
			\|Gatecoin provides an update regarding the hot wallet breach investigation, fund withdrawals, and frequently asked questions (FAQ)<ref>[https://twitter.com/Gatecoin/status/733564517901172736 Gatecoin - Update on Gatecoin Hot Wallet Breach Investigation, Fund Withdrawals & FAQ - Twitter] (April 25th, 2024)</ref><ref name=":20">[https://old.reddit.com/r/gatecoin/comments/4k75xq/update_on_gatecoin_hot_wallet_breach/ Update on Gatecoin Hot Wallet Breach Investigation, Fund Withdrawals & FAQ (May 20, 2016) - Reddit] (Accessed Apr 25, 2024)</ref>. The company expresses sincere apologies for the breach and appreciates the patience of clients and the community<ref name=":20">[https://old.reddit.com/r/gatecoin/comments/4k75xq/update_on_gatecoin_hot_wallet_breach/ Update on Gatecoin Hot Wallet Breach Investigation, Fund Withdrawals & FAQ (May 20, 2016) - Reddit] (Accessed Apr 25, 2024)</ref>. Notably, client data remains safe, and the investigation is ongoing with cooperation from authorities<ref name=":20">[https://old.reddit.com/r/gatecoin/comments/4k75xq/update_on_gatecoin_hot_wallet_breach/ Update on Gatecoin Hot Wallet Breach Investigation, Fund Withdrawals & FAQ (May 20, 2016) - Reddit] (Accessed Apr 25, 2024)</ref>. Progress has been made in fundraising efforts, aiming to reimburse stolen ETH and BTC funds<ref name=":20">[https://old.reddit.com/r/gatecoin/comments/4k75xq/update_on_gatecoin_hot_wallet_breach/ Update on Gatecoin Hot Wallet Breach Investigation, Fund Withdrawals & FAQ (May 20, 2016) - Reddit] (Accessed Apr 25, 2024)</ref>. Gatecoin offers a bounty for the return of stolen funds and addresses various user concerns through the FAQ section, promising updates on withdrawal availability, DGD token safety, and exchange relaunch plans<ref name=":20">[https://old.reddit.com/r/gatecoin/comments/4k75xq/update_on_gatecoin_hot_wallet_breach/ Update on Gatecoin Hot Wallet Breach Investigation, Fund Withdrawals & FAQ (May 20, 2016) - Reddit] (Accessed Apr 25, 2024)</ref>. CEO Aurélien Menant signs off with gratitude for continued patience and understanding from users<ref name=":20">[https://old.reddit.com/r/gatecoin/comments/4k75xq/update_on_gatecoin_hot_wallet_breach/ Update on Gatecoin Hot Wallet Breach Investigation, Fund Withdrawals & FAQ (May 20, 2016) - Reddit] (Accessed Apr 25, 2024)</ref>.
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	\|May 28th, 2016		\|May 28th, 2016

Azoundria: Integrating information from Twitter and Palantine King post. Reviewing to add more sources in.

2024-04-24T22:35:28Z

Integrating information from Twitter and Palantine King post. Reviewing to add more sources in.

← Older revision		Revision as of 16:35, 24 April 2024
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	Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.		Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.

	This exchange or platform is based in Hong Kong, or the incident targeted people primarily in Hong Kong.<ref name=":10">[https://web.archive.org/web/20160505123951/https://gatecoin.com/ Gatecoin Homepage Archive May 5th, 2016 6:39:51 AM MDT] (Accessed Apr 18, 2024)</ref><ref>[https://web.archive.org/web/20160514150920/https://gatecoin.com/ Gatecoin Homepage Official Statement Archive May 14th, 2016 9:09:20 AM MDT] (Accessed Apr XX, 2024)</ref><ref name=":11">[https://web.archive.org/web/20160518155002/http://gatecoin.com/ Gatecoin Homepage Archive May 18th, 2016 9:50:02 AM MDT] (Accessed Apr 18, 2024)</ref><ref>https://twitter.com/search?q=(from%3AGatecoin)%20until%3A2016-06-01%20since%3A2016-05-06&src=typed_query</ref>		This exchange or platform is based in Hong Kong, or the incident targeted people primarily in Hong Kong.<ref name=":10">[https://web.archive.org/web/20160505123951/https://gatecoin.com/ Gatecoin Homepage Archive May 5th, 2016 6:39:51 AM MDT] (Accessed Apr 18, 2024)</ref><ref>https://twitter.com/search?q=(from%3AGatecoin)%20until%3A2016-06-01%20since%3A2016-05-06&src=typed_query</ref><ref>https://www.reddit.com/r/digix/comments/4ilk1p/comment/d2z4m5q/ (Accessed Apr 24, 2024)</ref>

	== About Gatecoin ==		== About Gatecoin ==
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	\|Bitcoin Transaction		\|Bitcoin Transaction
	\|One of the bitcoin transactions involved in the theft for 12 BTC<ref name=":4">[https://www.blockchain.com/explorer/transactions/btc/d494c7ca3a03f30c121b02f558b068d3597092454ad325bc320383f070d536bc Theft Transaction Of 12 BTC - Blockchain.com] (Accessed Apr 17, 2024)</ref>.		\|One of the bitcoin transactions involved in the theft for 12 BTC<ref name=":4">[https://www.blockchain.com/explorer/transactions/btc/d494c7ca3a03f30c121b02f558b068d3597092454ad325bc320383f070d536bc Theft Transaction Of 12 BTC - Blockchain.com] (Accessed Apr 17, 2024)</ref>.
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	\|May 9th, 2016 4:01:19 AM MDT		\|May 9th, 2016 4:01:19 AM MDT
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	\|Bitcoin Transaction		\|Bitcoin Transaction
	\|A smaller bitcoin transaction involved in the theft for 2.12 BTC<ref name=":9">[https://www.blockchain.com/explorer/transactions/btc/435e0cc79372eef5f43d8d81320940165ea1a0828adab3fdb9822a17caffaf2b Theft Transaction Of 2.12 BTC - Blockchain.com] (Accessed Apr 17, 2024)</ref>.		\|A smaller bitcoin transaction involved in the theft for 2.12 BTC<ref name=":9">[https://www.blockchain.com/explorer/transactions/btc/435e0cc79372eef5f43d8d81320940165ea1a0828adab3fdb9822a17caffaf2b Theft Transaction Of 2.12 BTC - Blockchain.com] (Accessed Apr 17, 2024)</ref>.
			\|-
			\|May 9th, 2016 1:54:26 PM MDT
			\|Palantine King Downtime Post
			\|Palantine King posts on their website noting that Gatecoin, a significant player in DGD trading volumes which they actively trade, abruptly went offline after displaying a maintenance page for an hour<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. Despite calls for tweet updates during the maintenance, none were provided, fueling speculation of a hack<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. While the hack remains unconfirmed, early indicatorsI suggest it as a likely scenario<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. Given Gatecoin's substantial role in DGD trading, the incident could have significant consequences for DGD's price, particularly if hackers engage in unbalanced selling<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>. The situation is unfolding, and further updates are awaited<ref name=":17">[https://web.archive.org/web/20160512205427/http://palatineking.com/2016/05/09/gatecoin-hacked/ Gatecoin hacked - Palantine King Archive May 12th, 2016 2:54:27 PM MDT] (Accessed Apr 24, 2024)</ref>.
	\|-		\|-
	\|May 9th, 2016		\|May 9th, 2016
	\|Breach Begin		\|Breach Begin
	\|The reported date that that breach began<ref name=":1">[https://www.coindesk.com/gatecoin-2-million-bitcoin-ether-security-breach Gatecoin Claims $2 Million in Bitcoins and Ethers Lost in Security Breach - CoinDesk]</ref> at "late night HKT"<ref name=":0" />. There was a "disruption of [the Gatecoin] service caused by a server reboot"<ref name=":0" />. They "strongly believe that the breach is linked to this event"<ref name=":0" />.		\|The reported date that that breach began<ref name=":1">[https://www.coindesk.com/gatecoin-2-million-bitcoin-ether-security-breach Gatecoin Claims $2 Million in Bitcoins and Ethers Lost in Security Breach - CoinDesk]</ref> at "late night HKT"<ref name=":0" />. There was a "disruption of [the Gatecoin] service caused by a server reboot"<ref name=":0" />. They "strongly believe that the breach is linked to this event"<ref name=":0" />.
			\|-
			\|May 10th, 2016 10:04:00 AM MDT
			\|Palantine King False Alarm
			\|Palantine King posts the final update to their website, concluding that there was no problem with the Gatecoin exchange other than a temporary server outage, based largely on official information received from Gatecoin<ref name=":17" />.
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	\|May 12th, 2016		\|May 12th, 2016
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	\|Official Statement Released On Reddit		\|Official Statement Released On Reddit
	\|In a Reddit post, Gatecoin confirmed a breach of its system resulting in the loss of 15% of its crypto-asset deposits, valued at approximately $2 million<ref name=":0" />. The breach occurred between May 9 and May 12, 2016, with suspicious transactions detected on May 13 prompting the suspension of services. Despite storing most funds in multi-signature cold wallets, hackers bypassed this security measure, diverting ETH and BTC deposits to hot wallets during the breach. Gatecoin plans to release a platform for clients to withdraw remaining funds by May 28, 2016, with the exact date for ETH withdrawals pending confirmation. The exchange assures the security of DGD, REP, and DAO funds, while working to raise additional funds to reimburse affected customers. Gatecoin expresses gratitude for community support and pledges to provide updates via Twitter, Reddit, and its homepage<ref name=":0" />.		\|In a Reddit post, Gatecoin confirmed a breach of its system resulting in the loss of 15% of its crypto-asset deposits, valued at approximately $2 million<ref name=":0" />. The breach occurred between May 9 and May 12, 2016, with suspicious transactions detected on May 13 prompting the suspension of services. Despite storing most funds in multi-signature cold wallets, hackers bypassed this security measure, diverting ETH and BTC deposits to hot wallets during the breach. Gatecoin plans to release a platform for clients to withdraw remaining funds by May 28, 2016, with the exact date for ETH withdrawals pending confirmation. The exchange assures the security of DGD, REP, and DAO funds, while working to raise additional funds to reimburse affected customers. Gatecoin expresses gratitude for community support and pledges to provide updates via Twitter, Reddit, and its homepage<ref name=":0" />.
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			\|May 14th, 2016 5:37:00 AM MDT
			\|Official Statement On Twitter and Homepage
			\|An update is provided on Twitter, which links to the Gatecoin homepage as an official statement about the hack<ref>[https://twitter.com/Gatecoin/status/731448347379142656 Gatecoin - "SERVICE UPDATE: Official Statement Regarding Gatecoin Hot Wallet Breach. Read here" - Twitter] (Accessed Apr 24, 2024)</ref>. The Gatecoin homepage is later captured providing an official statement about the breach. Loss figures are provided as 15% of its crypto-asset deposits, totaling ETH 185,000 and BTC 250 (equivalent to USD 2 million) between May 9 and May 12, 2016<ref name=":18">[https://web.archive.org/web/20160514150920/https://gatecoin.com/ Gatecoin Homepage Official Statement Archive May 14th, 2016 9:09:20 AM MDT] (Accessed Apr XX, 2024)</ref>. The breach occurred due to a system alteration that allowed ETH and BTC deposits to bypass multi-signature cold storage and go directly to the hot wallet<ref name=":18" />. The compromised wallet addresses and Bitcoin transactions have been identified<ref name=":18" />. Gatecoin suspended its services upon detecting suspicious transactions and is working with Tehtri Security to investigate the breach thoroughly<ref name=":18" />. A platform enabling clients to withdraw remaining funds in various currencies will be released, and efforts are underway to raise additional funding to cover losses and reimburse affected customers<ref name=":18" />. Gatecoin expresses gratitude for the community's support and pledges to provide updates through various channels<ref name=":18" />.
	\|-		\|-
	\|May 16th, 2016 3:11:00 AM MDT		\|May 16th, 2016 3:11:00 AM MDT
Line 87:		Line 103:
	\|May 18th, 2016 9:50:02 AM MDT		\|May 18th, 2016 9:50:02 AM MDT
	\|Homepage 404 Error		\|Homepage 404 Error
	\|The present homepage is captured displaying a 404 error<ref name=":11" />.		\|The present homepage is captured displaying a 404 error<ref name=":11">[https://web.archive.org/web/20160518155002/http://gatecoin.com/ Gatecoin Homepage Archive May 18th, 2016 9:50:02 AM MDT] (Accessed Apr 18, 2024)</ref>.
	\|-		\|-
	\|May 28th, 2016		\|May 28th, 2016
Line 128:		Line 144:
	== Technical Details ==		== Technical Details ==

			The breach occurred due to a system alteration that allowed ETH and BTC deposits to bypass multi-signature cold storage and go directly to the hot wallet<ref name=":18" />.

	=== Breach Of Multi-Signature Systems ===		=== Breach Of Multi-Signature Systems ===
Line 199:		Line 215:
	"News emerged last week of yet another security event in the digital currency exchange ecosystem, this time impacting a Hong Kong-based service involved in the sale of assets related to Ethereum-based decentralized autonomous organizations (DAOs). As reported on Friday, Gatecoin experienced a cyberattack on its hot wallets that resulted in the loss of funds. A new update from the exchange team indicated that as much as $2m was lost, confirming rumors that circulated soon after the hack became apparent."<ref name="kylegibson-86" />		"News emerged last week of yet another security event in the digital currency exchange ecosystem, this time impacting a Hong Kong-based service involved in the sale of assets related to Ethereum-based decentralized autonomous organizations (DAOs). As reported on Friday, Gatecoin experienced a cyberattack on its hot wallets that resulted in the loss of funds. A new update from the exchange team indicated that as much as $2m was lost, confirming rumors that circulated soon after the hack became apparent."<ref name="kylegibson-86" />

	=== Statement On Reddit ===		=== Updates To Homepage ===
			An update was provided on the Gatecoin homepage. It highlighted the loss of 15% of its crypto-asset deposits, totaling USD 2 million in Ethereum and Bitcoin, between May 9 and May 12, 2016<ref name=":18" />. This breach was attributed to a system alteration that allowed deposits to bypass multi-signature cold storage and go directly to the hot wallet<ref name=":18" />. In response, Gatecoin suspended its services, initiated a forensic investigation with Tehtri Security, and identified the compromised wallet addresses and Bitcoin transactions<ref name=":18" />. To mitigate the impact on users, Gatecoin plans to release a bespoke platform for fund withdrawals and is working to raise additional funding to cover losses and reimburse affected customers<ref name=":18" />. They express gratitude for the community's support and pledge to provide updates through various communication channels<ref name=":18" />. The homepage later appeared to be offline with a 404 error<ref name=":11" />.

			=== Official Statement On Reddit ===
	On May 14th, a day after noticing the suspicious transactions and shutting down their services, Gatecoin issued a public statement through Reddit<ref name=":0" />.<blockquote>		On May 14th, a day after noticing the suspicious transactions and shutting down their services, Gatecoin issued a public statement through Reddit<ref name=":0" />.<blockquote>
	The Gatecoin team greatly appreciates the patience of all users and stakeholders while we work with Tehtri Security to confirm all of the details related to the breach and ensure that our systems can be moved to a new, clean, thoroughly tested, and monitored infrastructure before services can resume.		The Gatecoin team greatly appreciates the patience of all users and stakeholders while we work with Tehtri Security to confirm all of the details related to the breach and ensure that our systems can be moved to a new, clean, thoroughly tested, and monitored infrastructure before services can resume.

Azoundria: Reviewed and integrated Bloomberg article about banking service limitation. Reviewing and integrating Reddit thread about liquidation. Integrated a large amount of information about the CoinDesk article on the breach and Gatecoin reaction. Integrated information from a tweet by Gatecoin Twitter. Integrated information from a Reddit thread about freezing wallet addresses.

2024-04-23T22:35:12Z

Reviewed and integrated Bloomberg article about banking service limitation. Reviewing and integrating Reddit thread about liquidation. Integrated a large amount of information about the CoinDesk article on the breach and Gatecoin reaction. Integrated information from a tweet by Gatecoin Twitter. Integrated information from a Reddit thread about freezing wallet addresses.

← Older revision		Revision as of 16:35, 23 April 2024
Line 3:		Line 3:
	Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.		Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.

	This exchange or platform is based in Hong Kong, or the incident targeted people primarily in Hong Kong.<ref name=":10">[https://web.archive.org/web/20160505123951/https://gatecoin.com/ Gatecoin Homepage Archive May 5th, 2016 6:39:51 AM MDT] (Accessed Apr 18, 2024)</ref><ref>https://www.bloomberg.com/news/articles/2019-03-03/why-crypto-companies-still-can-t-open-checking-accounts</ref><ref>https://www.reddit.com/r/gatecoin/comments/b0pe1i/gatecoin_liquidated/</ref><ref>https://www.coindesk.com/markets/2016/05/13/digital-currency-exchange-gatecoin-offline-after-loss-of-funds/</ref><ref>https://twitter.com/Gatecoin/status/732136409650208768</ref><ref>https://np.reddit.com/r/ethereum/comments/4oxog1/gatecoins_hacked_ether_addresses_are_known_do_we/</ref><ref>[https://web.archive.org/web/20160514150920/https://gatecoin.com/ Gatecoin Homepage Official Statement Archive May 14th, 2016 9:09:20 AM MDT] (Accessed Apr XX, 2024)</ref><ref name=":11">[https://web.archive.org/web/20160518155002/http://gatecoin.com/ Gatecoin Homepage Archive May 18th, 2016 9:50:02 AM MDT] (Accessed Apr 18, 2024)</ref>		This exchange or platform is based in Hong Kong, or the incident targeted people primarily in Hong Kong.<ref name=":10">[https://web.archive.org/web/20160505123951/https://gatecoin.com/ Gatecoin Homepage Archive May 5th, 2016 6:39:51 AM MDT] (Accessed Apr 18, 2024)</ref><ref>[https://web.archive.org/web/20160514150920/https://gatecoin.com/ Gatecoin Homepage Official Statement Archive May 14th, 2016 9:09:20 AM MDT] (Accessed Apr XX, 2024)</ref><ref name=":11">[https://web.archive.org/web/20160518155002/http://gatecoin.com/ Gatecoin Homepage Archive May 18th, 2016 9:50:02 AM MDT] (Accessed Apr 18, 2024)</ref><ref>https://twitter.com/search?q=(from%3AGatecoin)%20until%3A2016-06-01%20since%3A2016-05-06&src=typed_query</ref>

	== About Gatecoin ==		== About Gatecoin ==
Line 64:		Line 64:
	\|Cited Date		\|Cited Date
	\|The date of the hack cited by Kyle Gibson<ref name="kylegibson-86" />. On "Friday night HKT" is when the team "detected some suspicious transactions and immediately suspended [thei]r services to investigate"<ref name=":0" />.		\|The date of the hack cited by Kyle Gibson<ref name="kylegibson-86" />. On "Friday night HKT" is when the team "detected some suspicious transactions and immediately suspended [thei]r services to investigate"<ref name=":0" />.
			\|-
			\|May 13th, 2016 4:50:00 PM MDT
			\|CoinDesk Article Released
			\|CoinDesk reports that Gatecoin faces turmoil after reportedly experiencing a hack, resulting in losses from its connected wallets<ref name=":13">[https://www.coindesk.com/markets/2016/05/13/digital-currency-exchange-gatecoin-offline-after-loss-of-funds/ Digital Currency Exchange Gatecoin Offline After Loss of Funds - CoinDesk] (Accessed Apr 23, 2024)</ref>. CEO Aurélien Menant confirmed the incident and assured users of efforts to refund customers affected by the breach<ref name=":13">[https://www.coindesk.com/markets/2016/05/13/digital-currency-exchange-gatecoin-offline-after-loss-of-funds/ Digital Currency Exchange Gatecoin Offline After Loss of Funds - CoinDesk] (Accessed Apr 23, 2024)</ref>. Users are faced with uncertainty and concern regarding the security of their funds<ref name=":13">[https://www.coindesk.com/markets/2016/05/13/digital-currency-exchange-gatecoin-offline-after-loss-of-funds/ Digital Currency Exchange Gatecoin Offline After Loss of Funds - CoinDesk] (Accessed Apr 23, 2024)</ref>. Gatecoin's assurance of conducting a full forensic investigation to identify the root cause of the issue is a positive step, but the timeline for resolution and the extent of the losses remain unclear<ref name=":13">[https://www.coindesk.com/markets/2016/05/13/digital-currency-exchange-gatecoin-offline-after-loss-of-funds/ Digital Currency Exchange Gatecoin Offline After Loss of Funds - CoinDesk] (Accessed Apr 23, 2024)</ref>.
	\|-		\|-
	\|May 14th, 2016 5:22:56 AM MDT		\|May 14th, 2016 5:22:56 AM MDT
	\|Official Statement Released On Reddit		\|Official Statement Released On Reddit
	\|In a Reddit post, Gatecoin confirmed a breach of its system resulting in the loss of 15% of its crypto-asset deposits, valued at approximately $2 million<ref name=":0" />. The breach occurred between May 9 and May 12, 2016, with suspicious transactions detected on May 13 prompting the suspension of services. Despite storing most funds in multi-signature cold wallets, hackers bypassed this security measure, diverting ETH and BTC deposits to hot wallets during the breach. Gatecoin plans to release a platform for clients to withdraw remaining funds by May 28, 2016, with the exact date for ETH withdrawals pending confirmation. The exchange assures the security of DGD, REP, and DAO funds, while working to raise additional funds to reimburse affected customers. Gatecoin expresses gratitude for community support and pledges to provide updates via Twitter, Reddit, and its homepage<ref name=":0" />.		\|In a Reddit post, Gatecoin confirmed a breach of its system resulting in the loss of 15% of its crypto-asset deposits, valued at approximately $2 million<ref name=":0" />. The breach occurred between May 9 and May 12, 2016, with suspicious transactions detected on May 13 prompting the suspension of services. Despite storing most funds in multi-signature cold wallets, hackers bypassed this security measure, diverting ETH and BTC deposits to hot wallets during the breach. Gatecoin plans to release a platform for clients to withdraw remaining funds by May 28, 2016, with the exact date for ETH withdrawals pending confirmation. The exchange assures the security of DGD, REP, and DAO funds, while working to raise additional funds to reimburse affected customers. Gatecoin expresses gratitude for community support and pledges to provide updates via Twitter, Reddit, and its homepage<ref name=":0" />.
			\|-
			\|May 16th, 2016 3:11:00 AM MDT
			\|Gatecoin on Withdrawal Of REP Tweet
			\|A Gatecoin agent account responds to a customer inquiry about the ability to withdraw the REP tokens from their account<ref name=":14">[https://twitter.com/Gatecoin/status/732136409650208768 Gatecoin - "we will build a custom platform for REP, DAO, DGD and fiat withdrawals for release on or before May 28." - Twitter] (Accessed Apr 23, 2024)</ref>. They note that they are planning to build a custom interface to facilitate these withdrawals by March 28th<ref name=":14">[https://twitter.com/Gatecoin/status/732136409650208768 Gatecoin - "we will build a custom platform for REP, DAO, DGD and fiat withdrawals for release on or before May 28." - Twitter] (Accessed Apr 23, 2024)</ref>.
	\|-		\|-
	\|May 16th, 2016 10:27:00 AM MDT		\|May 16th, 2016 10:27:00 AM MDT
	\|CoinDesk Article On Breach		\|CoinDesk Article On Breach
	\|CoinDesk reports that Gatecoin has disclosed the cyberattack on its hot wallets, with the loss of funds estimated at $2 million<ref name=":1" />. The breach, believed to have begun on May 9th and continued for three days, led to the theft of 185,000 ethers and 250 bitcoins. Gatecoin acknowledged that its security measures, including multi-signature cold wallets, were compromised, allowing funds to bypass cold storage and go directly to hot wallets during the breach. The incident coincided with TheDAO's crowdsale, raising concerns about the security of Ethereum-based tokens<ref name=":1" />. Gatecoin plans to establish a portal for withdrawing DAO-related tokens in two weeks but did not specify a timeline for processing bitcoin and ether withdrawals<ref name=":1" />.		\|CoinDesk reports that Gatecoin has disclosed the cyberattack on its hot wallets, with the loss of funds estimated at $2 million<ref name=":1" />. The breach, believed to have begun on May 9th and continued for three days, led to the theft of 185,000 ethers and 250 bitcoins. Gatecoin acknowledged that its security measures, including multi-signature cold wallets, were compromised, allowing funds to bypass cold storage and go directly to hot wallets during the breach. The incident coincided with TheDAO's crowdsale, raising concerns about the security of Ethereum-based tokens<ref name=":1" />. Gatecoin plans to establish a portal for withdrawing DAO-related tokens in two weeks but did not specify a timeline for processing bitcoin and ether withdrawals<ref name=":1" />.
			\|-
			\|
			\|
			\|
	\|-		\|-
	\|May 18th, 2016 9:50:02 AM MDT		\|May 18th, 2016 9:50:02 AM MDT
Line 80:		Line 92:
	\|Withdrawal Platform Promised		\|Withdrawal Platform Promised
	\|The original Reddit announcement promised a withdrawal site would be made available on May 28th<ref name=":0" />. The promised withdrawals were for remaining funds in BTC, DAO, DGD, REP, USD, EUR and HKD<ref name=":0" />.		\|The original Reddit announcement promised a withdrawal site would be made available on May 28th<ref name=":0" />. The promised withdrawals were for remaining funds in BTC, DAO, DGD, REP, USD, EUR and HKD<ref name=":0" />.
			\|-
			\|June 20th, 2016 2:07:35 AM MDT
			\|Freezing Ethereum Wallets
			\|A Reddit thread discusses freezing the hacker's ethereum wallet addresses, since they are known at the time<ref>[https://old.reddit.com/r/ethereum/comments/4oxog1/gatecoins_hacked_ether_addresses_are_known_do_we/ gatecoin's hacked ether addresses are known, do we freeze them too? - Reddit] (Accessed Apr 23, 2024)</ref>.
	\|-		\|-
	\|September 15th, 2017		\|September 15th, 2017
Line 88:		Line 104:
	\|CoinTelegraph Banking Freeze Report		\|CoinTelegraph Banking Freeze Report
	\|CoinTelegraph reports on Gatecoin losing its banking services<ref name=":2" />. Despite the surge in customer base and Bitcoin price rally, Gatecoin experienced a banking freeze in September without prior notice, forcing it to seek foreign banking support to continue operations<ref name=":2" />. This incident highlights the challenges faced by cryptocurrency businesses in accessing banking services, with many relying on foreign banks to operate amidst domestic restrictions<ref name=":2" />. Additionally, the resistance from Hong Kong's banking sector contrasts with its interest in blockchain technology, as evidenced by the participation of twenty local banks in a trade network with Singapore utilizing blockchain<ref name=":2" />.		\|CoinTelegraph reports on Gatecoin losing its banking services<ref name=":2" />. Despite the surge in customer base and Bitcoin price rally, Gatecoin experienced a banking freeze in September without prior notice, forcing it to seek foreign banking support to continue operations<ref name=":2" />. This incident highlights the challenges faced by cryptocurrency businesses in accessing banking services, with many relying on foreign banks to operate amidst domestic restrictions<ref name=":2" />. Additionally, the resistance from Hong Kong's banking sector contrasts with its interest in blockchain technology, as evidenced by the participation of twenty local banks in a trade network with Singapore utilizing blockchain<ref name=":2" />.
			\|-
			\|March 2nd, 2019 11:00:14 PM MST
			\|Bloomberg Banking Services Issues
			\|Using Gatecoin as an example, Bloomberg reports that crypto companies are facing challenges in accessing basic banking services from mainstream institutions like HSBC and JPMorgan Chase, despite attracting investments from large institutions<ref name=":15">[https://www.bloomberg.com/news/articles/2019-03-03/why-crypto-companies-still-can-t-open-checking-accounts Why Crypto Companies Still Can’t Open Checking Accounts - Bloomberg] (Accessed Apr 23, 2024)</ref>. This issue persists globally, from New York to Hong Kong, hindering the growth and development of the digital-assets industry<ref name=":15">[https://www.bloomberg.com/news/articles/2019-03-03/why-crypto-companies-still-can-t-open-checking-accounts Why Crypto Companies Still Can’t Open Checking Accounts - Bloomberg] (Accessed Apr 23, 2024)</ref>.
			\|-
			\|March 13th, 2019 12:26:16 PM MDT
			\|Reddit Thread On Bankruptcy
			\|A Reddit thread discusses a liquidation of Gatecoin<ref name=":16">[https://www.reddit.com/r/gatecoin/comments/b0pe1i/gatecoin_liquidated/ kuilef - "gatecoin liquidated :(" - Reddit] (Accessed Apr 23, 2024)</ref>. Users are frustrated and unable to access their funds<ref name=":16">[https://www.reddit.com/r/gatecoin/comments/b0pe1i/gatecoin_liquidated/ kuilef - "gatecoin liquidated :(" - Reddit] (Accessed Apr 23, 2024)</ref>. Some users suspect foul play, while others scramble to recover whatever they can<ref name=":16">[https://www.reddit.com/r/gatecoin/comments/b0pe1i/gatecoin_liquidated/ kuilef - "gatecoin liquidated :(" - Reddit] (Accessed Apr 23, 2024)</ref>. The situation sparks a mix of anger, desperation, and a few glimmers of hope for resolution<ref name=":16">[https://www.reddit.com/r/gatecoin/comments/b0pe1i/gatecoin_liquidated/ kuilef - "gatecoin liquidated :(" - Reddit] (Accessed Apr 23, 2024)</ref>.
	\|-		\|-
	\|March 14th, 2019 8:50:00 AM MDT		\|March 14th, 2019 8:50:00 AM MDT
Line 165:		Line 189:
	== Immediate Reactions ==		== Immediate Reactions ==

			Gatecoin promptly shut down its exchange and ports after suspecting a potential leak in its hot wallets and started an investigation<ref name=":13" />. Gatecoin communicated with its users through various channels, including Slack and Twitter<ref name=":13" />. CEO Aurélien Menant provided updates via Slack, informing users about the incident and the measures being taken to address it<ref name=":13" />. Gatecoin provided updates on the status of its website through Twitter, informing users about the high risk of a leak in some of its hot wallets and the decision to take the website offline as a precautionary measure<ref name=":13" />.

			=== Forensic Security Examination ===
			The platform initiated a full forensic investigation to identify the root cause of the issue and determine the extent of the breach<ref name=":13" />. Gatecoin involved the services of third party Tehtri Security to conduct a forensic examination<ref name=":0" />.

	Gatecoin ~~involved~~ the ~~services of third party Tehtri Security~~ to ~~conduct~~ a forensic ~~examination~~<ref name=":0" />.		=== CoinDesk Article and Statement ===
			CoinDesk was one of the first to report on the hack<ref name=":13" />. Gatecoin issued a statement to CoinDesk, acknowledging the suspected leak in its hot wallets and the decision to shut down the exchange and ports as a precautionary measure<ref name=":13" />. The statement outlined the ongoing forensic investigation and the exchange's commitment to minimizing further potential losses<ref name=":13" />.

	"News emerged last week of yet another security event in the digital currency exchange ecosystem, this time impacting a Hong Kong-based service involved in the sale of assets related to Ethereum-based decentralized autonomous organizations (DAOs). As reported on Friday, Gatecoin experienced a cyberattack on its hot wallets that resulted in the loss of funds. A new update from the exchange team indicated that as much as $2m was lost, confirming rumors that circulated soon after the hack became apparent."<ref name="kylegibson-86" />		"News emerged last week of yet another security event in the digital currency exchange ecosystem, this time impacting a Hong Kong-based service involved in the sale of assets related to Ethereum-based decentralized autonomous organizations (DAOs). As reported on Friday, Gatecoin experienced a cyberattack on its hot wallets that resulted in the loss of funds. A new update from the exchange team indicated that as much as $2m was lost, confirming rumors that circulated soon after the hack became apparent."<ref name="kylegibson-86" />
Line 192:		Line 220:

	== Total Amount Recovered ==		== Total Amount Recovered ==
			Gatecoin reassured users from the start that it would seek to refund customers following the loss<ref name=":13" />. While the CEO initially indicated uncertainties regarding the exact amount of funds taken, Gatecoin affirmed its intention to refund affected users<ref name=":13" />.

	There do not appear to have been any funds recovered in this case.		There do not appear to have been any funds recovered in this case.

Azoundria: 30 minutes. Generated a new logo/image for Gatecoin. Prevention section updated. Updated inclusion list sentence. Review sources further.

2024-04-19T17:44:02Z

30 minutes. Generated a new logo/image for Gatecoin. Prevention section updated. Updated inclusion list sentence. Review sources further.

← Older revision		Revision as of 11:44, 19 April 2024
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	=== Inclusion On Hack Lists ===		=== Inclusion On Hack Lists ===
	The attack was included on ~~a list~~ put together by Kyle Gibson<ref name="kylegibson-86" />.<ref name="bitcoinexchangeguide-218" /><ref name="slowmisthacked-1160" />		The attack was included on lists put together by Kyle Gibson<ref name="kylegibson-86" />, BitcoinExchangeGuide.com<ref name="bitcoinexchangeguide-218" />, and SlowMist<ref name="slowmisthacked-1160" />.

	== Total Amount Recovered ==		== Total Amount Recovered ==
Line 195:		Line 195:

	== Ongoing Developments ==		== Ongoing Developments ==
	~~TBD~~		The Gatecoin platform declared bankruptcy.
	== Individual Prevention Policies ==		== Individual Prevention Policies ==
	~~{{Prevention:Individuals:Placeholder}}~~

	{{Prevention:Individuals:Avoid Third Party Custodians}}		{{Prevention:Individuals:Avoid Third Party Custodians}}

	{{Prevention:Individuals:~~Avoid Third Party Custodians~~}}		{{Prevention:Individuals:Store Funds Offline}}

	{{Prevention:Individuals:End}}		{{Prevention:Individuals:End}}

	== Platform Prevention Policies ==		== Platform Prevention Policies ==
	{{Prevention:Platforms:~~Placeholder~~}}		{{Prevention:Platforms:Regular Audit Procedures}}

	{{Prevention:Platforms:Establish Industry Insurance Fund}}		{{Prevention:Platforms:Establish Industry Insurance Fund}}
Line 213:		Line 211:

	== Regulatory Prevention Policies ==		== Regulatory Prevention Policies ==
	{{Prevention:Regulators:~~Placeholder~~}}		{{Prevention:Regulators:Platform Security Assessments}}

	{{Prevention:Regulators:Establish Industry Insurance Fund}}		{{Prevention:Regulators:Establish Industry Insurance Fund}}

Azoundria at 17:31, 19 April 2024

2024-04-19T17:31:03Z

← Older revision		Revision as of 11:31, 19 April 2024
Line 1:		Line 1:
	{{Case Study Under Construction}}{{Unattributed Sources}}		{{Case Study Under Construction}}{{Unattributed Sources}}[[File:Gatecoin.jpg\|thumb\|Gatecoin Homepage/Logo]]

	Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.		Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.

Azoundria: 30 minutes. Integrated CoinTelegraph article with more about the founding of Gatecoin and expansion into segregated bank accounts and regulatory compliance. Reviewed and added infromation from the homepage. Working on generating a gatecoin screenshot of homepage. Had to use other sources with screenshots as the internet archive didn't appear to load it well.

2024-04-18T22:47:45Z

30 minutes. Integrated CoinTelegraph article with more about the founding of Gatecoin and expansion into segregated bank accounts and regulatory compliance. Reviewed and added infromation from the homepage. Working on generating a gatecoin screenshot of homepage. Had to use other sources with screenshots as the internet archive didn't appear to load it well.

← Older revision		Revision as of 16:47, 18 April 2024
Line 3:		Line 3:
	Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.		Gatecoin was one of the first regulated digital asset exchanges. This didn’t stop the hack of 185,000 ETH and 250 BTC. According to a forensic analysis, the exchange may have been the victim of a man-in-the-middle attack. The malicious external party involved in this breach managed to alter their system so that BTC and ETH deposit transfers bypassed the multisig cold storage and went directly to the hacker’s wallet during the breach period. The company fired their CTO, managed to raise $500k in order to reopen, and ultimately repaid all customers. They were saved by maintaining large cold wallet reserves which appear to have been properly stored, and appear to have dealt with the issue transparently. Having hot wallet insurance would have further assisted with the recovery. A system like Proof of Reserves or an automated alert system could have allowed the issue to be noted sooner.

	This exchange or platform is based in Hong Kong, or the incident targeted people primarily in Hong Kong.<ref>https://~~cointelegraph~~.~~com~~/~~news~~/~~gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts<~~/~~ref><ref>~~https://gatecoin.com/</ref><ref>https://www.bloomberg.com/news/articles/2019-03-03/why-crypto-companies-still-can-t-open-checking-accounts</ref><ref>https://www.reddit.com/r/gatecoin/comments/b0pe1i/gatecoin_liquidated/</ref><ref>https://www.coindesk.com/markets/2016/05/13/digital-currency-exchange-gatecoin-offline-after-loss-of-funds/</ref><ref>https://twitter.com/Gatecoin/status/732136409650208768</ref><ref>https://np.reddit.com/r/ethereum/comments/4oxog1/gatecoins_hacked_ether_addresses_are_known_do_we/</ref>		This exchange or platform is based in Hong Kong, or the incident targeted people primarily in Hong Kong.<ref name=":10">[https://web.archive.org/web/20160505123951/https://gatecoin.com/ Gatecoin Homepage Archive May 5th, 2016 6:39:51 AM MDT] (Accessed Apr 18, 2024)</ref><ref>https://www.bloomberg.com/news/articles/2019-03-03/why-crypto-companies-still-can-t-open-checking-accounts</ref><ref>https://www.reddit.com/r/gatecoin/comments/b0pe1i/gatecoin_liquidated/</ref><ref>https://www.coindesk.com/markets/2016/05/13/digital-currency-exchange-gatecoin-offline-after-loss-of-funds/</ref><ref>https://twitter.com/Gatecoin/status/732136409650208768</ref><ref>https://np.reddit.com/r/ethereum/comments/4oxog1/gatecoins_hacked_ether_addresses_are_known_do_we/</ref><ref>[https://web.archive.org/web/20160514150920/https://gatecoin.com/ Gatecoin Homepage Official Statement Archive May 14th, 2016 9:09:20 AM MDT] (Accessed Apr XX, 2024)</ref><ref name=":11">[https://web.archive.org/web/20160518155002/http://gatecoin.com/ Gatecoin Homepage Archive May 18th, 2016 9:50:02 AM MDT] (Accessed Apr 18, 2024)</ref>

	== About Gatecoin ==		== About Gatecoin ==
	~~Established~~ in 2013 in Hong Kong, Gatecoin primarily focused on Bitcoin and Ethereum markets<ref name="thenextweb-16" />.		Founded and established in 2013 in Hong Kong, Gatecoin primarily focused on Bitcoin and Ethereum markets<ref name="thenextweb-16" />. In 2015, Gatecoin recently launched a new Bitcoin exchange featuring robust security measures<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. These measures include segregated client bank accounts, multi-signature cold storage, and continuous monitoring by an external IT security firm<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. The company emphasizes its commitment to regulatory compliance, operating under a Hong Kong Money Service Operator license and adhering to AML/KYC rules<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. Gatecoin's segregated bank accounts ensure that clients' funds are kept separate from operational expenses, minimizing counterparty risks<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>.

	Aurélien Menant was the ~~current~~ CEO ~~at the time~~ of ~~the incident~~<ref name=":0">[https://old.reddit.com/r/gatecoin/comments/4jb1la/official_statement_regarding_gatecoin_hot_wallet/ OFFICIAL STATEMENT REGARDING GATECOIN HOT WALLET BREACH - Reddit] (Accessed Apr 2, 2024)</ref>.		The exchange allows users to trade Bitcoin against USD, Euro, and HKD, with plans to integrate Ripple into its platform soon<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. Additionally, Gatecoin planned the introduction of a white-labeled debit card that could be reloaded instantly online using bitcoins, providing users with a convenient way to spend their digital currency worldwide without incurring foreign transaction fees<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>. Looking ahead from 2015, Gatecoin expressed aims to expand its business to the US and Europe, focusing on obtaining the necessary licenses and developing innovative digital currency trading services and payment methods to enhance user experience<ref name=":12">[https://cointelegraph.com/news/gatecoin-launches-bitcoin-exchange-with-segregated-bank-accounts Gatecoin Launches Bitcoin Exchange with ‘Segregated Bank Accounts’ - CoinTelegraph]</ref>.

			Gatecoin is a regulated and secure financial institution specializing in blockchain assets<ref name=":10" />. Based in Hong Kong, the platform offers deep liquidity through a market maker rebate program and features an instant buy/sell option for seamless currency swaps. It provides advanced trading tools designed by professional brokers, ensuring access to innovative features and top-tier connectivity options. Gatecoin emphasizes compliance and transparency, boasting KYC and AML processes supported by a major compliance solutions provider. Users can easily buy and sell bitcoin, ether (Ethereum), and DAO tokens worldwide with various fiat currencies, benefiting from public live-data streaming, a fully documented REST API, and dedicated customer support. The exchange's trading system is decentralized, modular, scalable, and highly secured, employing bank-grade security procedures and segregated client accounts. Moreover, Gatecoin offers a smart and mobile-optimized interface for intuitive trading experiences, continually enhancing its platform for user convenience and efficiency<ref name=":10" />.

			Aurélien Menant was the CEO of Gatecoin through 2015 and 2016<ref name=":0">[https://old.reddit.com/r/gatecoin/comments/4jb1la/official_statement_regarding_gatecoin_hot_wallet/ OFFICIAL STATEMENT REGARDING GATECOIN HOT WALLET BREACH - Reddit] (Accessed Apr 2, 2024)</ref>.

	== The Reality ==		== The Reality ==
	Gatecoin was not monitoring their balance integrity on an ongoing basis, and was unaware of an intrusion into their system.		The Gatecoin server infrastructure was insecure against outside vulnerabilities. It would also appear that Gatecoin was not monitoring their balance integrity on an ongoing basis, and was unaware of an intrusion into their system for several days.

	== What Happened ==		== What Happened ==
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	!Event		!Event
	!Description		!Description
			\|-
			\|January 30th, 2015 4:10:26 AM MST
			\|Segregated Bank Account Launch
			\|CoinTelegraph announces that Hong-Kong based Gatecoin Limited has launched a new Bitcoin exchange with stringent security measures, including segregated client bank accounts, multi-signature cold storage, and continuous monitoring and audit by an external IT security firm<ref name=":12" />. Segregated bank accounts ensure that clients' funds are kept separate from operational expenses, minimizing counterparty risks. Gatecoin CEO Aurélien Menant emphasized the rarity of this practice in the crypto space, stating that it dramatically reduces risks for clients<ref name=":12" />. The company, operating with a Hong Kong Money Service Operator license and complying with AML/KYC rules, has secured a unique banking structure due to its regulatory compliance<ref name=":12" />. Gatecoin offers trading in Bitcoin against USD, Euro, and HKD, with plans to integrate Ripple into its platform soon. Additionally, it is introducing a white-labeled debit card, usable worldwide without foreign transaction fees, reloadable with bitcoins online instantly<ref name=":12" />. Gatecoin aims to expand its services to the US and Europe, focusing on obtaining necessary licenses and developing innovative trading services and payment methods to enhance customer experience<ref name=":12" />.
	\|-		\|-
	\|May 9th, 2016 1:38:25 AM MDT		\|May 9th, 2016 1:38:25 AM MDT
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	\|CoinDesk Article On Breach		\|CoinDesk Article On Breach
	\|CoinDesk reports that Gatecoin has disclosed the cyberattack on its hot wallets, with the loss of funds estimated at $2 million<ref name=":1" />. The breach, believed to have begun on May 9th and continued for three days, led to the theft of 185,000 ethers and 250 bitcoins. Gatecoin acknowledged that its security measures, including multi-signature cold wallets, were compromised, allowing funds to bypass cold storage and go directly to hot wallets during the breach. The incident coincided with TheDAO's crowdsale, raising concerns about the security of Ethereum-based tokens<ref name=":1" />. Gatecoin plans to establish a portal for withdrawing DAO-related tokens in two weeks but did not specify a timeline for processing bitcoin and ether withdrawals<ref name=":1" />.		\|CoinDesk reports that Gatecoin has disclosed the cyberattack on its hot wallets, with the loss of funds estimated at $2 million<ref name=":1" />. The breach, believed to have begun on May 9th and continued for three days, led to the theft of 185,000 ethers and 250 bitcoins. Gatecoin acknowledged that its security measures, including multi-signature cold wallets, were compromised, allowing funds to bypass cold storage and go directly to hot wallets during the breach. The incident coincided with TheDAO's crowdsale, raising concerns about the security of Ethereum-based tokens<ref name=":1" />. Gatecoin plans to establish a portal for withdrawing DAO-related tokens in two weeks but did not specify a timeline for processing bitcoin and ether withdrawals<ref name=":1" />.
			\|-
			\|May 18th, 2016 9:50:02 AM MDT
			\|Homepage 404 Error
			\|The present homepage is captured displaying a 404 error<ref name=":11" />.
	\|-		\|-
	\|May 28th, 2016		\|May 28th, 2016

Azoundria: 30 minutes. Tweak about section a bit. Complete an analysis of all blockchain transactions involved in the process.

2024-04-17T17:44:32Z

30 minutes. Tweak about section a bit. Complete an analysis of all blockchain transactions involved in the process.

Show changes

Azoundria: Confirmed all sources are already in the wiki page. Integrated additional information from the Reddit official announcement. Integrating CoinTelegraph and SCMP articles on banking freeze.

2024-04-08T22:06:33Z

Confirmed all sources are already in the wiki page. Integrated additional information from the Reddit official announcement. Integrating CoinTelegraph and SCMP articles on banking freeze.

Show changes