Vircurex Exchange Hack - Revision history

Azoundria: Another 30 minutes complete. Reviewing information and more about lawsuit to try to gain any blockchain data.

2024-01-04T18:16:01Z

Another 30 minutes complete. Reviewing information and more about lawsuit to try to gain any blockchain data.

← Older revision		Revision as of 12:16, 4 January 2024
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	{{Case Study Under Construction}}[[File:Vircurex.jpg\|thumb\|Vircurex Homepage/Logo]]Vircurex was a virtual currency exchange which supported trading in bitcoin and various alternative blockchains. In January 2013, ~~it was reported that~~ multiple wallets with customer funds were compromised. The platform reopened and went on to be breached again in May 2013. Customers were not provided with the full details of the platform's solvency, and large withdrawals which happened in March 2014 ultimately brought the platform to a close. It appears that legal actions continue, having been complicated by the operators providing false information about ~~where they were from~~.		{{Case Study Under Construction}}[[File:Vircurex.jpg\|thumb\|Vircurex Homepage/Logo]]Vircurex was a virtual currency exchange which supported trading in bitcoin and various alternative blockchains. In January 2013, multiple wallets with customer funds were reportedly compromised. The platform reopened and went on to be breached again in May 2013. Customers were not provided with the full details of the platform's solvency, and large withdrawals which happened in March 2014 ultimately brought the platform to a close. It appears that legal actions continue, having been complicated by the operators providing false information about their location.

	== About Vircurex ==		== About Vircurex ==
	Vircurex was a Beijing-based virtual currency exchange which was operational since October 2011<ref name="coindesk-179" />.		Vircurex was a Beijing-based virtual currency exchange<ref name="coindesk-179" /> which was operational since October 2011<ref name="coindesk-179" /><ref name=":5">[https://www.financemagnates.com/cryptocurrency/news/vircurex-faces-class-action-lawsuit/ Vircurex Faces Class-Action Lawsuit - Finance Magnates] (Jan 4, 2024)</ref>.

	Vircurex was based in Germany(?). The exchange supported trading in different cryptocurrencies including bitcoin, namecoin, devcoin, litecoin, ixcoin, ppcoin, and terracoin<ref name=":0" />. The Vircurex platform enabled trading between BTC, USD or EUR, plus up to 18 other cryptocurrencies, however they've eliminated some less popular coins over time<ref name="coindesk-179" />.		Vircurex was based in Germany(?). The exchange supported trading in different cryptocurrencies including bitcoin, namecoin, devcoin, litecoin, ixcoin, ppcoin, and terracoin<ref name=":0" />. The Vircurex platform enabled trading between BTC, USD or EUR, plus up to 18 other cryptocurrencies, however they've eliminated some less popular coins over time<ref name="coindesk-179" />.

			Vircurex gained popularity by offering interest to users holding multiple cryptocurrencies<ref name=":5">[https://www.financemagnates.com/cryptocurrency/news/vircurex-faces-class-action-lawsuit/ Vircurex Faces Class-Action Lawsuit - Finance Magnates] (Jan 4, 2024)</ref>.

	The exchange offered deposits and withdrawals in both USD and EUR<ref name=":0" />. The homepage of the website featured pricing tables for all supported coins<ref name=":0" />.<blockquote>Vircurex, the exchange platform for buying, selling and trading your Bitcoins and its various alt-chains.		The exchange offered deposits and withdrawals in both USD and EUR<ref name=":0" />. The homepage of the website featured pricing tables for all supported coins<ref name=":0" />.<blockquote>Vircurex, the exchange platform for buying, selling and trading your Bitcoins and its various alt-chains.
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	== The Reality ==		== The Reality ==
	The Vircurex platform wallets were vulnerable.		The Vircurex platform wallets were vulnerable.

			=== False Information About Location ===
			TBD

	== What Happened ==		== What Happened ==
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	\|Included In BitcoinTalk List		\|Included In BitcoinTalk List
	\|A Vircurex exchange hack is featured in the BitcoinTalk "List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses" published by user dree12, although this list includes [[Vircurex Second Exchange Hack\|the second Vircurex hack which happened in May 2013]], and not the January 2013 hack<ref name="bitcointalklist-87" />.		\|A Vircurex exchange hack is featured in the BitcoinTalk "List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses" published by user dree12, although this list includes [[Vircurex Second Exchange Hack\|the second Vircurex hack which happened in May 2013]], and not the January 2013 hack<ref name="bitcointalklist-87" />.
			\|-
			\|January 2016
			\|Last Payment From Exchange
			\|The exchange makes it's last repayment to affected users<ref name=":5" />.
	\|-		\|-
	\|January 12th, 2018 11:00:48 AM MST		\|January 12th, 2018 11:00:48 AM MST
	\|CoinDesk Report Of Lawsuit		\|CoinDesk Report Of Lawsuit
	\|CoinDesk reports that former customers of the cryptocurrency exchange Vircurex are suing the platform four years after it froze their funds and allegedly failed to repay them. Filed in the U.S. District Court in Colorado, the lawsuit accuses Vircurex of breach of contract, conversion of funds, fraud, and unjust enrichment. The complaint details how only a few account holders received their funds after the exchange froze withdrawals due to claimed insufficient reserves, with approximately $50 million collectively frozen in accounts. Despite the loss, Vircurex has allowed customers to deposit funds over the past four years and continues to operate. The lawsuit alleges deceptive statements and false promises by Vircurex, accusing the exchange of attempting to evade accountability<ref name="coindesk-178" />.		\|CoinDesk reports that former customers of the cryptocurrency exchange Vircurex are suing the platform four years after it froze their funds and allegedly failed to repay them. Filed in the U.S. District Court in Colorado, the lawsuit accuses Vircurex of breach of contract, conversion of funds, fraud, and unjust enrichment. The complaint details how only a few account holders received their funds after the exchange froze withdrawals due to claimed insufficient reserves, with approximately $50 million collectively frozen in accounts. Despite the loss, Vircurex has allowed customers to deposit funds over the past four years and continues to operate. The lawsuit alleges deceptive statements and false promises by Vircurex, accusing the exchange of attempting to evade accountability<ref name="coindesk-178" />.
			\|-
			\|January 15th, 2018 1:39:08 AM MST
			\|Finance Magnate Article
			\|Finance Magnate also reports details of the lawsuit<ref name=":5" />. Cryptocurrency exchange Vircurex is facing a class-action lawsuit for failing to return approximately $50 million worth of frozen assets to its customers. In 2014, the exchange froze withdrawals due to insufficient funds, exacerbated by major hacks in 2013 and increased withdrawal requests following the Mt. Gox incident. While assuring users they would eventually receive their funds, the last payment occurred in January 2016. The lawsuit, filed by customer Timothy Shaw in Colorado District Court, accuses Vircurex's founder, Andreas Eckert, and an unknown Chinese national of deceptive statements and false promises, seeking recovery for the frozen funds totaling 1,666 BTC, 124,763 LTC, and 78,782 TRC<ref name=":5" />.
	\|-		\|-
	\|February 27th, 2019 11:31:32 AM MST		\|February 27th, 2019 11:31:32 AM MST
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	TBD - Review more of the BitcoinTalk thread<ref name=":1" />.		TBD - Review more of the BitcoinTalk thread<ref name=":1" />.

			TBD - Review more of the lawsuit<ref>[https://www.courthousenews.com/wp-content/uploads/2018/01/Shaw-Vircurex-COMPLAINT.pdf Shaw Vircurex Complaint] (Jan 4, 2024)</ref>

	"In 2014, the exchange reported it was near insolvency after losing large amounts of its reserve funds. According to the lawsuit, part of this loss came from “two purported hacks the exchange experienced in mid-2013.”		"In 2014, the exchange reported it was near insolvency after losing large amounts of its reserve funds. According to the lawsuit, part of this loss came from “two purported hacks the exchange experienced in mid-2013.”
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	== Total Amount Recovered ==		== Total Amount Recovered ==
	~~There do not appear~~ to ~~have been any~~ funds ~~recovered in this case.~~		Vircurex continued to pay out funds to affected users until January 2016<ref name="coindesk-178" />, however the total amount fell far short of what had originally been lost.

	~~What funds were recovered? What funds were reimbursed for those~~ affected users?

	== Ongoing Developments ==		== Ongoing Developments ==

Azoundria: Another 30 minutes complete. Significant expansion of the case study. Integrating CoinDesk article details.

2023-12-14T18:54:40Z

Another 30 minutes complete. Significant expansion of the case study. Integrating CoinDesk article details.

← Older revision		Revision as of 12:54, 14 December 2023
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	{{Case Study Under Construction}}~~{{Unattributed Sources}}~~		{{Case Study Under Construction}}[[File:Vircurex.jpg\|thumb\|Vircurex Homepage/Logo]]Vircurex was a virtual currency exchange which supported trading in bitcoin and various alternative blockchains. In January 2013, it was reported that multiple wallets with customer funds were compromised. The platform reopened and went on to be breached again in May 2013. Customers were not provided with the full details of the platform's solvency, and large withdrawals which happened in March 2014 ultimately brought the platform to a close. It appears that legal actions continue, having been complicated by the operators providing false information about where they were from.

	~~[[File:~~Vircurex~~.jpg\|thumb\|Vircurex Homepage/Logo]]~~Vircurex was a ~~German~~ exchange which ~~supported trading in bitcoin and various alternative blockchains. With an anonymous exchange operator, once the hacks occurred, neither hack~~ was ~~revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring.~~		== About Vircurex ==
			Vircurex was a Beijing-based virtual currency exchange which was operational since October 2011<ref name="coindesk-179" />.
	~~<ref name="bitcointalklist-87" />~~<ref name="coindesk-179" />

	~~== About Vircurex ==~~		Vircurex was based in Germany(?). The exchange supported trading in different cryptocurrencies including bitcoin, namecoin, devcoin, litecoin, ixcoin, ppcoin, and terracoin<ref name=":0" />. The Vircurex platform enabled trading between BTC, USD or EUR, plus up to 18 other cryptocurrencies, however they've eliminated some less popular coins over time<ref name="coindesk-179" />.
	Vircurex was based in Germany. The exchange supported trading in different cryptocurrencies including bitcoin, namecoin, devcoin, litecoin, ixcoin, ppcoin, and terracoin<ref name=":0" />.

	The exchange offered deposits and withdrawals in both USD and EUR<ref name=":0" />. The homepage of the website featured pricing tables for all supported coins<ref name=":0" />.<blockquote>Vircurex, the exchange platform for buying, selling and trading your Bitcoins and its various alt-chains.		The exchange offered deposits and withdrawals in both USD and EUR<ref name=":0" />. The homepage of the website featured pricing tables for all supported coins<ref name=":0" />.<blockquote>Vircurex, the exchange platform for buying, selling and trading your Bitcoins and its various alt-chains.
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	== The Reality ==		== The Reality ==
	The Vircurex platform ~~had already suffered 2 significant hacks in 2013~~.		The Vircurex platform wallets were vulnerable.

	== What Happened ==		== What Happened ==
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	\|The BitcoinTalk thread is edited, however it appears that only the title was modified from "VIRCUREX !!! IMPORTANT !!!" to just "VIRCUREX"<ref name=":1" /><ref name=":2" />		\|The BitcoinTalk thread is edited, however it appears that only the title was modified from "VIRCUREX !!! IMPORTANT !!!" to just "VIRCUREX"<ref name=":1" /><ref name=":2" />
	\|-		\|-
	\|March ~~24th~~, 2014		\|March 3rd, 2014 9:44:52 AM MST
	\|~~CoinDesk Report~~		\|Bitcoin Withdrawal Error Appearing
	\|~~CoinDesk reports~~ that the platform ~~has frozen~~ withdrawals<ref name="coindesk-179" />. ~~TBD need~~ to ~~review~~ article and ~~update link~~. ~~Got internal server error~~ and ~~issues accessing archive on Dec 11~~, ~~2023~~.		\|Users almightyruler and Littleshop report that they have received an error "Do you have a pop-up blocke[r] active or did you manually change the URL?" when attempting to withdraw bitcoin from the platform. It's mentioned that withdrawals are temporarily stopped at this time<ref>[https://bitcointalk.org/index.php?topic=49383.720 Re: closed - BitcoinTalk] (Dec 14, 2023)</ref>. This is later included in a CoinDesk article<ref name="coindesk-179" />.
			\|-
			\|March 23rd, 2014 6:01:00 PM MDT
			\|CoinDesk Reports Funds Frozen
			\|CoinDesk reports that the Vircurex platform has announced a freeze on most of its digital currency withdrawals, including bitcoin, litecoin, feathercoin, and terracoin, citing a lack of reserves to cover customer requests. The article mentions the shortfall and freeze of BTC/LTC withdrawals in January 2013 after reporting compromised wallets. "The company pledged to cover the losses from its own income and had been doing so until yesterday, when "large fund withdrawals in the last weeks" completely depleted its cold wallet reserves." At this point, the company plans to create a new balance type called 'Frozen Funds' to cover affected balances and pledges to gradually pay back the losses, emphasizing that it does not intend to shut down. The recent freeze is attributed to large fund withdrawals depleting its cold wallet reserves. The incident raises concerns about exchanges operating fractional reserve systems, leading to calls for proof of reserves through secure cryptographic methods<ref name="coindesk-179" />.
	\|-		\|-
	\|April 18th, 2014 7:56:22 PM MDT		\|April 18th, 2014 7:56:22 PM MDT
	\|Included In BitcoinTalk List		\|Included In BitcoinTalk List
	\|A ~~subsequent~~ Vircurex exchange hack is featured in the BitcoinTalk "List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses" published by user dree12<ref name="bitcointalklist-87" />.		\|A Vircurex exchange hack is featured in the BitcoinTalk "List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses" published by user dree12, although this list includes [[Vircurex Second Exchange Hack\|the second Vircurex hack which happened in May 2013]], and not the January 2013 hack<ref name="bitcointalklist-87" />.
	\|-		\|-
	\|January 12th, 2018 11:00:48 AM MST		\|January 12th, 2018 11:00:48 AM MST
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	<ref name=":3" /><ref name=":4" /><blockquote>Further update: The system was not breached, no passwords were compromised (they are salted and multiple times hashed anyways). The attacker used a RubyOnRails vulnerability that was released yesterday (<nowiki>http://www.exploit-db.com/exploits/24019/</nowiki>) to withdraw the funds therefore.</blockquote>		<ref name=":3" /><ref name=":4" /><blockquote>Further update: The system was not breached, no passwords were compromised (they are salted and multiple times hashed anyways). The attacker used a RubyOnRails vulnerability that was released yesterday (<nowiki>http://www.exploit-db.com/exploits/24019/</nowiki>) to withdraw the funds therefore.</blockquote>


	Yet more of its reserve funds were depleted by large withdrawals by some of its customers."		Yet more of its reserve funds were depleted by large withdrawals by some of its customers."
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	=== Hack Again Later In 2013 ===		=== Hack Again Later In 2013 ===
	<ref>https://web.archive.org/web/20140323195552/https://vircurex.com/welcome/ann_reserved.html</ref>		Vircurex was [[Vircurex Second Exchange Hack\|hacked again later in 2013]]<ref>https://web.archive.org/web/20140323195552/https://vircurex.com/welcome/ann_reserved.html</ref>.

			=== Ultimate Freezing Of Funds ===
			In March 2014, Vircurex announced a freeze on most of its digital currency withdrawals, including bitcoin, litecoin, feathercoin, and terracoin, citing a lack of reserves to cover customer requests<ref name="coindesk-179" />. The company announced plans to create a new balance type called 'Frozen Funds' to cover affected balances and pledges to gradually pay back the losses, emphasizing that it does not intend to shut down. Vircurex faced a reserve shortfall previously, freezing BTC/LTC withdrawals in January 2013 after reporting compromised wallets. The recent freeze is attributed to large fund withdrawals depleting its cold wallet reserves.

			=== Legal Action Brought Against Owners ===
			With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring.

	== Total Amount Recovered ==		== Total Amount Recovered ==
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	== Ongoing Developments ==		== Ongoing Developments ==
	~~What parts~~ of ~~this case are still remaining to be concluded?~~		There is presently legal action being taken against the operators of the Vircurex exchange.
	== General Prevention Policies ==		== General Prevention Policies ==
	Coming soon.		Coming soon.
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	<ref name="bitcointalklist-87">[https://bitcointalk.org/index.php?topic=576337 dree12 - List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses - BitcoinTalk] (Feb 15, 2020)</ref>		<ref name="bitcointalklist-87">[https://bitcointalk.org/index.php?topic=576337 dree12 - List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses - BitcoinTalk] (Feb 15, 2020)</ref>
	<ref name="coindesk-178">[https://www.coindesk.com/former-customers-sue-vircurex-exchange-over-frozen-crypto-funds Former Customers Sue Crypto Exchange Vircurex Over Frozen Funds - CoinDesk] (Feb 29, 2020)</ref>		<ref name="coindesk-178">[https://www.coindesk.com/former-customers-sue-vircurex-exchange-over-frozen-crypto-funds Former Customers Sue Crypto Exchange Vircurex Over Frozen Funds - CoinDesk] (Feb 29, 2020)</ref>
	<ref name="coindesk-179">[https://www.coindesk.com/exchange-vircurex-freezes-withdrawals-claims-lack-reserves Exchange Vircurex Freezes Withdrawals, Claims Lack of Reserves - CoinDesk] (Feb 29, 2020)</ref>		<ref name="coindesk-179">[https://web.archive.org/web/20210919020219/https://www.coindesk.com/markets/2014/03/24/exchange-vircurex-freezes-withdrawals-claims-lack-of-reserves/ Exchange Vircurex Freezes Withdrawals, Claims Lack of Reserves - CoinDesk - Archive September 18th, 2021 8:02:19 PM MDT] (Feb 29, 2020)</ref>
	<ref name="bitcoinexchangeguide-218">[https://web.archive.org/web/20200413134528/https://bitcoinexchangeguide.com/bitcoin/scams-hacks/ Bitcoin Scams and Cryptocurrency Hacks List - BitcoinExchangeGuide.com Archive April 13th, 2020 7:45:28 AM MDT] (Mar 5, 2020)</ref>		<ref name="bitcoinexchangeguide-218">[https://web.archive.org/web/20200413134528/https://bitcoinexchangeguide.com/bitcoin/scams-hacks/ Bitcoin Scams and Cryptocurrency Hacks List - BitcoinExchangeGuide.com Archive April 13th, 2020 7:45:28 AM MDT] (Mar 5, 2020)</ref>
	</references>		</references>

Azoundria: Another 30 minutes complete. More sources integrated. There appear to be two separate hacks which happened to the Vircurex platform.

2023-12-12T19:13:47Z

Another 30 minutes complete. More sources integrated. There appear to be two separate hacks which happened to the Vircurex platform.

Show changes

Azoundria: Another 30 minutes complete. About section spread around. Reviewed some sources and added in additional sources. Added a new logo/homepage screenshot.

2023-12-11T21:19:40Z

Another 30 minutes complete. About section spread around. Reviewed some sources and added in additional sources. Added a new logo/homepage screenshot.

← Older revision		Revision as of 15:19, 11 December 2023
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	== About Vircurex ==		== About Vircurex ==
	Vircurex was based in Germany.		Vircurex was based in Germany. The exchange supported trading in different cryptocurrencies including bitcoin, namecoin, devcoin, litecoin, ixcoin, ppcoin, and terracoin<ref name=":0" />.

	Homepage: vircurex.com<ref>[https://web.archive.org/web/20130424071356/https://vircurex.com/ Vircurex Exchange Homepage] (Dec 11, 2023)</ref>		The exchange offered deposits and withdrawals in both USD and EUR<ref name=":0" />. The homepage of the website featured pricing tables for all supported coins<ref name=":0" />.<blockquote>Vircurex, the exchange platform for buying, selling and trading your Bitcoins and its various alt-chains.

			We currently support Bitcoin, Namecoin, Devcoin, Litecoin, Ixcoin, PPCoin, Terracoin</blockquote>Homepage: vircurex.com<ref name=":0">[https://web.archive.org/web/20130424071356/https://vircurex.com/ Vircurex Exchange Homepage Archive April 24th, 2013 1:13:56 AM MDT] (Dec 11, 2023)</ref>

	== The Reality ==		== The Reality ==

Azoundria at 20:31, 11 December 2023

2023-12-11T20:31:16Z

← Older revision		Revision as of 14:31, 11 December 2023
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	{{Case Study Under Construction}}{{Unattributed Sources}}		{{Case Study Under Construction}}{{Unattributed Sources}}

	In the early days of exchanges, storage of funds in essentially hot wallets was incredibly common. With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring.		[[File:Vircurex.jpg\|thumb\|Vircurex Homepage/Logo]]In the early days of exchanges, storage of funds in essentially hot wallets was incredibly common. With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring.

	This exchange or platform is based in Germany, or the incident targeted people primarily in Germany.<ref name="kylegibson-86" /><ref name="bitcointalklist-87" /><ref name="coindesk-179" />		This exchange or platform is based in Germany, or the incident targeted people primarily in Germany.<ref name="kylegibson-86" /><ref name="bitcointalklist-87" /><ref name="coindesk-179" />

Azoundria: so far

2023-12-11T20:29:56Z

so far

Show changes

Azoundria at 20:01, 11 December 2023

2023-12-11T20:01:44Z

← Older revision		Revision as of 14:01, 11 December 2023
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	\|		\|
	\|}		\|}

			== Technical Details ==
			This section includes specific detailed technical analysis of any security breaches which happened. What specific software vulnerabilities contributed to the problem and how were they exploited?

	== Total Amount Lost ==		== Total Amount Lost ==

Azoundria at 23:52, 12 April 2023

2023-04-12T23:52:14Z

← Older revision		Revision as of 17:52, 12 April 2023
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	{{Imported Case Study\|source=https://www.quadrigainitiative.com/casestudy/vircurexexchangehack.php}}		{{Imported Case Study 2\|source=https://www.quadrigainitiative.com/casestudy/vircurexexchangehack.php}}
	{{Unattributed ~~Citations~~}}		{{Unattributed Sources}}

	In the early days of exchanges, storage of funds in essentially hot wallets was incredibly common. With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring.		In the early days of exchanges, storage of funds in essentially hot wallets was incredibly common. With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring.

	This exchange or platform is based in Germany, or the incident targeted people primarily in Germany.		This exchange or platform is based in Germany, or the incident targeted people primarily in Germany.<ref name="kylegibson-86" /><ref name="bitcointalklist-87" /><ref name="coindesk-178" /><ref name="coindesk-179" /><ref name="bitcoinexchangeguide-218" />
	<ref name="kylegibson-86" /><ref name="bitcointalklist-87" /><ref name="coindesk-178" /><ref name="coindesk-179" /><ref name="bitcoinexchangeguide-218" />

	== About Vircurex ==		== About Vircurex ==
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	!Description		!Description
	\|-		\|-
	\|January 1st, 2013 12:00:15 AM		\|January 1st, 2013 12:00:15 AM MST
	\|Main Event		\|Main Event
	\|Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.		\|Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.
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	== Ongoing Developments ==		== Ongoing Developments ==
	What parts of this case are still remaining to be concluded?		What parts of this case are still remaining to be concluded?
			== General Prevention Policies ==
			Coming soon.
			== Individual Prevention Policies ==
			{{Prevention:Individuals:Placeholder}}

			{{Prevention:Individuals:End}}

	== Prevention Policies ==		== Platform Prevention Policies ==
	~~Coming soon.~~		{{Prevention:Platforms:Placeholder}}

			{{Prevention:Platforms:End}}

			== Regulatory Prevention Policies ==
			{{Prevention:Regulators:Placeholder}}

			{{Prevention:Regulators:End}}

	== References ==		== References ==
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	<ref name="bitcointalklist-87">[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 15, 2020)</ref>		<ref name="bitcointalklist-87">[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 15, 2020)</ref>

	<ref name="coindesk-178">[https://www.coindesk.com/former-customers-sue-vircurex-exchange-over-frozen-crypto-funds Former Customers Sue Crypto Exchange Vircurex Over Frozen Funds - CoinDesk] (Feb 28, 2020)</ref>		<ref name="coindesk-178">[https://www.coindesk.com/former-customers-sue-vircurex-exchange-over-frozen-crypto-funds Former Customers Sue Crypto Exchange Vircurex Over Frozen Funds - CoinDesk] (Feb 29, 2020)</ref>

	<ref name="coindesk-179">[https://www.coindesk.com/exchange-vircurex-freezes-withdrawals-claims-lack-reserves Exchange Vircurex Freezes Withdrawals, Claims Lack of Reserves] (Feb 28, 2020)</ref>		<ref name="coindesk-179">[https://www.coindesk.com/exchange-vircurex-freezes-withdrawals-claims-lack-reserves Exchange Vircurex Freezes Withdrawals, Claims Lack of Reserves] (Feb 29, 2020)</ref>

	<ref name="bitcoinexchangeguide-218">[https://bitcoinexchangeguide.com/bitcoin/scams-hacks/ Bitcoin Scams and Cryptocurrency Hacks List - BitcoinExchangeGuide.com] (Mar 5, 2020)</ref></references>		<ref name="bitcoinexchangeguide-218">[https://bitcoinexchangeguide.com/bitcoin/scams-hacks/ Bitcoin Scams and Cryptocurrency Hacks List - BitcoinExchangeGuide.com] (Mar 5, 2020)</ref></references>

Azoundria at 20:53, 15 February 2023

2023-02-15T20:53:17Z

← Older revision		Revision as of 14:53, 15 February 2023
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	{{Imported Case Study\|source=https://www.quadrigainitiative.com/casestudy/vircurexexchangehack.php}}		{{Imported Case Study\|source=https://www.quadrigainitiative.com/casestudy/vircurexexchangehack.php}}
			{{Unattributed Citations}}

	In the early days of exchanges, storage of funds in essentially hot wallets was incredibly common. With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring.		In the early days of exchanges, storage of funds in essentially hot wallets was incredibly common. With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring.

	This exchange or platform is based in Germany, or the incident targeted people primarily in Germany.		This exchange or platform is based in Germany, or the incident targeted people primarily in Germany.
			<ref name="kylegibson-86" /><ref name="bitcointalklist-87" /><ref name="coindesk-178" /><ref name="coindesk-179" /><ref name="bitcoinexchangeguide-218" />

	== About Vircurex ==		== About Vircurex ==
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	Don't Include:		Don't Include:

	* Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.		* Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
	* Anything that wasn't reasonably knowable at the time of the event.		* Anything that wasn't reasonably knowable at the time of the event.
Line 45:		Line 46:
	\|-		\|-
	\|January 1st, 2013 12:00:15 AM		\|January 1st, 2013 12:00:15 AM
	\|~~First~~ Event		\|Main Event
	\|~~This is an expanded~~ description of what happened and the impact. If multiple lines are necessary, add them here.		\|Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.
	\|-
	\|
	\|
	\|
	\|-		\|-
	\|		\|
Line 58:		Line 55:

	== Total Amount Lost ==		== Total Amount Lost ==
	$50 000 000 USD		The total amount lost has been estimated at $50,000,000 USD.

	How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?		How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

Line 68:		Line 66:

	== Total Amount Recovered ==		== Total Amount Recovered ==
	~~$0 USD~~		There do not appear to have been any funds recovered in this case.

	What funds were recovered? What funds were reimbursed for those affected users?		What funds were recovered? What funds were reimbursed for those affected users?

Line 78:		Line 77:

	== References ==		== References ==
	[https://medium.com/@kylegibson/100-crypto-thefts-a-timeline-of-hacks-glitches-exit-scams-and-other-lost-cryptocurrency-873c87fd5522 100 Crypto Thefts: A Timeline of Hacks, Glitches, Exit Scams, and other Lost Cryptocurrency Incidents] (Jan 24)		<references><ref name="kylegibson-86">[https://medium.com/@kylegibson/100-crypto-thefts-a-timeline-of-hacks-glitches-exit-scams-and-other-lost-cryptocurrency-873c87fd5522 100 Crypto Thefts: A Timeline of Hacks, Glitches, Exit Scams, and other Lost Cryptocurrency Incidents] (Jan 25, 2020)</ref>

	[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 14)		<ref name="bitcointalklist-87">[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 15, 2020)</ref>

	[https://www.coindesk.com/former-customers-sue-vircurex-exchange-over-frozen-crypto-funds Former Customers Sue Crypto Exchange Vircurex Over Frozen Funds - CoinDesk] (Feb 28)		<ref name="coindesk-178">[https://www.coindesk.com/former-customers-sue-vircurex-exchange-over-frozen-crypto-funds Former Customers Sue Crypto Exchange Vircurex Over Frozen Funds - CoinDesk] (Feb 28, 2020)</ref>

	[https://www.coindesk.com/exchange-vircurex-freezes-withdrawals-claims-lack-reserves Exchange Vircurex Freezes Withdrawals, Claims Lack of Reserves] (Feb 28)		<ref name="coindesk-179">[https://www.coindesk.com/exchange-vircurex-freezes-withdrawals-claims-lack-reserves Exchange Vircurex Freezes Withdrawals, Claims Lack of Reserves] (Feb 28, 2020)</ref>

	[https://bitcoinexchangeguide.com/bitcoin/scams-hacks/ Bitcoin Scams and Cryptocurrency Hacks List - BitcoinExchangeGuide.com] (Mar 4)		<ref name="bitcoinexchangeguide-218">[https://bitcoinexchangeguide.com/bitcoin/scams-hacks/ Bitcoin Scams and Cryptocurrency Hacks List - BitcoinExchangeGuide.com] (Mar 5, 2020)</ref></references>

Azoundria: Created page with "{{Imported Case Study|source=https://www.quadrigainitiative.com/casestudy/vircurexexchangehack.php}} In the early days of exchanges, storage of funds in essentially hot wallets was incredibly common. With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring. This exchange or platform is based in Germany, or the incident targ..."

2023-01-21T06:19:51Z

Created page with "{{Imported Case Study|source=https://www.quadrigainitiative.com/casestudy/vircurexexchangehack.php}} In the early days of exchanges, storage of funds in essentially hot wallets was incredibly common. With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring. This exchange or platform is based in Germany, or the incident targ..."

New page

{{Imported Case Study|source=https://www.quadrigainitiative.com/casestudy/vircurexexchangehack.php}}

In the early days of exchanges, storage of funds in essentially hot wallets was incredibly common. With an anonymous exchange operator, once the hacks occurred, neither hack was revealed until far later. The exchange even lied about where they were based in an effort to prevent a lawsuit from occurring.

This exchange or platform is based in Germany, or the incident targeted people primarily in Germany.

== About Vircurex ==
"In 2014, the exchange reported it was near insolvency after losing large amounts of its reserve funds. According to the lawsuit, part of this loss came from “two purported hacks the exchange experienced in mid-2013.” Yet more of its reserve funds were depleted by large withdrawals by some of its customers." “The freeze will affect all bitcoin, litecoin, feathercoin and terracoin withdrawals. A message on Vircurex’s site says it will create a new balance type called ‘Frozen Funds’ covering all balances in the aforementioned currencies. The company maintains it won’t be shutting down, saying it intends to “gradually pay back the losses”.” “That Vircurex had a reserve shortfall had been known for some time, though not the exact amount. It froze BTC/LTC withdrawals in January 2013 after reporting that wallets had been compromised, but still allowed deposits in those currencies to continue.” “In a lawsuit filed in the U.S. District Court in Colorado, a former Vircurex customer accuses the exchange of breach of contract, conversion of funds, fraud and unjust enrichment. The suit explained how only a few of the account holders had received their funds after the exchange froze all withdrawals due to a claimed lack of reserves. At present, the frozen accounts contain a combined $50 million.” “Vircurex’s steps to prevent its customers from suing included stating it was incorporated in Belize, which it is not, as well as indicating it might be based in Beijing. The lawsuit states the exchange is actually based out of Germany, but has never been legally incorporated in any jurisdiction, meaning it is not recognized as a formal business by any government.”

This exchange or platform is based in Germany, or the incident targeted people primarily in Germany.

The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.

Include:

* Known history of when and how the service was started.
* What problems does the company or service claim to solve?
* What marketing materials were used by the firm or business?
* Audits performed, and excerpts that may have been included.
* Business registration documents shown (fake or legitimate).
* How were people recruited to participate?
* Public warnings and announcements prior to the event.

Don't Include:

* Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
* Anything that wasn't reasonably knowable at the time of the event.
There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.

== The Reality ==
This sections is included if a case involved deception or information that was unknown at the time. Examples include:

* When the service was actually started (if different than the "official story").
* Who actually ran a service and their own personal history.
* How the service was structured behind the scenes. (For example, there was no "trading bot".)
* Details of what audits reported and how vulnerabilities were missed during auditing.

== What Happened ==
The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.
{| class="wikitable"
|+Key Event Timeline - Vircurex Exchange Hack
!Date
!Event
!Description
|-
|January 1st, 2013 12:00:15 AM
|First Event
|This is an expanded description of what happened and the impact. If multiple lines are necessary, add them here.
|-
|
|
|
|-
|
|
|
|}

== Total Amount Lost ==
$50 000 000 USD
How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

== Immediate Reactions ==
How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?

== Ultimate Outcome ==
What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

== Total Amount Recovered ==
$0 USD
What funds were recovered? What funds were reimbursed for those affected users?

== Ongoing Developments ==
What parts of this case are still remaining to be concluded?

== Prevention Policies ==
Coming soon.

== References ==
[https://medium.com/@kylegibson/100-crypto-thefts-a-timeline-of-hacks-glitches-exit-scams-and-other-lost-cryptocurrency-873c87fd5522 100 Crypto Thefts: A Timeline of Hacks, Glitches, Exit Scams, and other Lost Cryptocurrency Incidents] (Jan 24)

[https://bitcointalk.org/index.php?topic=576337 List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses] (Feb 14)

[https://www.coindesk.com/former-customers-sue-vircurex-exchange-over-frozen-crypto-funds Former Customers Sue Crypto Exchange Vircurex Over Frozen Funds - CoinDesk] (Feb 28)

[https://www.coindesk.com/exchange-vircurex-freezes-withdrawals-claims-lack-reserves Exchange Vircurex Freezes Withdrawals, Claims Lack of Reserves] (Feb 28)

[https://bitcoinexchangeguide.com/bitcoin/scams-hacks/ Bitcoin Scams and Cryptocurrency Hacks List - BitcoinExchangeGuide.com] (Mar 4)