Vircurex Second Exchange Hack
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Vircurex experienced a second hack in 2013, which ultimately contributed to the collapse of the exchange later in 2014. It appears that attempts were made to repay the debt with ongoing profits, however this proposal appears to be very poorly implemented and lacked any indication of how the platform was going to prevent future hacks.
The country for this case study is not yet known.[1][2]
About Vircurex
"The hot wallet and “warm” wallet of Bitcoin to alternative cryptocurrency exchange service Vircurex was emptied in May 2013, resulting in a significant loss of three currencies: Bitcoin, Terracoin, and Litecoin.[57] Initially, Vircurex operated normally despite the loss, though it no longer paid dividends to shareholders. In March 2014, due to strain caused by large withdrawals (in addition to a default by AurumXChange, a fiat processor Vircurex used), Vircurex froze large quantities of many currencies; however, it promises to pay these back eventually.[59]"
The country for this case study is not yet known.
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.
| Date | Event | Description |
|---|---|---|
| May 10th, 2013 | Breach Date | Reported date of breach. |
| April 18th, 2014 7:56:22 PM MDT | 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[1]. |
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
1454 BTC x $117.20 = $170408.8
The total amount lost has been estimated at $170,000 USD.
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?
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.
References
- ↑ List of Major Bitcoin Heists, Thefts, Hacks, Scams, and Losses (Feb 15, 2020)
- ↑ Wayback Machine (Dec 12, 2023)