Bithumb Privacy/Phishing Hack

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Bithumb

Company policy apparently allowed an employee to “take home” customer records, and this employee had security faults on their PC. One would assume that an exchange would invest in additional precautions to protect traders, with explicit confirmations when funds are being withdrawn, especially if withdrawal wallet addresses are changed or added, and access is happening from an unexpected location. However, from screenshots online, it appears that the text messages only say “BITHUMB Verification Code” and are sent via SMS. Then, between the breach in February, and the detection in June, 4 months passed. During this entire time, one would assume that multiple customers would have reported funds missing. Apparently, it took all these people getting together and organized with each other before something was done. In the end, this situation resulted in a full reimbursement for all customers of what they’d lost, with additional reimbursement for the privacy breach.

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

About Bithumb

“Hackers have stolen user data … from Bithumb, one of the top five biggest Ethereum and Bitcoin cryptocurrency exchanges” “The exchange has a 75.7 percent share of the South Korean bitcoin market, with a daily trading volume of over 13,000 bitcoins. It is also the world’s largest ethereum market and accounts for around 44 percent of South Korea’s ether trading.” "A cyber attack late last week resulted in the loss of billions of won from customers accounts...Hackers succeeded in grabbing the personal information of 31,800 Bithumb website users, including their names, mobile phone numbers and email addresses." “At the time, Bithumb was the world’s fourth largest bitcoin exchange and the largest exchange in South Korea, accounting for over 75% of bitcoin trading volume in South Korea. The hack was traced back to a single employee’s compromised PC. Many users reported having millions of Won disappear from their personal accounts overnight.” “Bithumb said that the thieves stole a database of user information off the personal computer of an employee, rather than off the company’s internal network. The attackers allegedly nabbed the names, email addresses, and mobile phone numbers (no passwords, apparently), of more than 31,800 customers, according to a Monday report from Yonhap, a South Korean news wire.” “According to the 'Meeting People Lost With Bithumb Hacking,' which was formed on the 27th of [June], it is estimated that hundreds of hundreds to hundreds of billions of money were withdrawn from accounts of more than 100 investors. One member claims to have robbed 1.2 billion won.” “One victim claims that the attacker posed as an executive at Bithumb and phoned to say that he was "suspicious of a foreign hacking transaction,” and instructed his victim to give him an “identification number written on the letter from Bithumb.”” “Apparently, the crooks phoned Bitcoin holders pretending to be Bithumb bosses, and convinced some of their marks to hand over one-time passwords granting access to their money stores.” “The security breach is believed to have occurred in February of this year, discovered on June 28, and the authorities were alerted the very next day. Now people are being told to change their passwords as a precaution, and have been assured they will be reimbursed if any of their cyber-dosh has gone missing – plus about 90 bucks each in compensation for having their personal info carelessly spilled.”

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

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.

Key Event Timeline - Bithumb Privacy/Phishing Hack

Date	Event	Description
June 1st, 2017 12:00:52 AM MDT	Main Event	Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.

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

The total amount lost has been estimated at $31,000,000 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

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?

Ongoing Developments

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

General Prevention Policies

Coming soon.

Individual Prevention Policies

No specific policies for individual prevention have yet been identified in this case.

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

Policies for platforms to take to prevent this situation have not yet been selected in this case.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

No specific regulatory policies have yet been identified in this case.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.