NYDIG HubSpot Data Breach

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Notice: This page is a new case study and some aspects have not been fully researched. Some sections may be incomplete or reflect inaccuracies present in initial sources. Please check the References at the bottom for further information and perform your own additional assessment. Please feel free to contribute by adding any missing information or sources you come across. If you are new here, please read General Tutorial on Wikis or Anatomy of a Case Study for help getting started.

NYDIG

NYDIG is an institution-grade bitcoin company offering multiple bitcoin-integrated products. They were reportedly among those companies affected by the Hubspot data breach. A third party tweet shows an email they have sent to athose affected. They they have not publicly confirmed the breach or made any further statements. There have been no specific reports I could locate of NYDIG clients being targeted subsequently.

About NYDIG

NYDIG is a prominent financial services and technology firm based in New York[1]. NYDIG was established in 2017[1] as a subsidiary of Stone Ridge, a holding company with a strong presence in technology and finance[2]. They deliver Bitcoin products across various industries, combining regulatory standards with robust technology to make Bitcoin accessible to all[2]. Their leadership team has extensive experience in institutional asset management, trading, technology, and regulation[2]. The team includes Ross Stevens, the founder and executive chairman, Tejas Shah as the CEO, and Nate Conrad as the president[2].

NYDIG is a bitcoin company aiming to make Bitcoin accessible to billions of people worldwide and create a universal financial system[3][4]. NYDIG believes that universal access to Bitcoin can uplift humanity, protect the value of people's work, and drive personal and societal progress[2]. They work with banks, fintechs, investment managers, and other innovators who want to integrate Bitcoin into their offerings[2]. They combine high-tech solutions with institutional-grade finance to offer a range of financial products[3].

NYDIG allows partners to white label their solutions and develop their own bitcoin-related products such as accounts, rewards, and loyalty programs[3][4]. Their approach involves unlocking the power and potential of Bitcoin by helping businesses create innovative products and offering white-label solutions[2]. They focus on various sectors, including banking, fintech, asset management, insurance, corporations, mining, and nonprofit organizations[3][4]. NYDIG offers services to build and integrate bitcoin products, invest and trade to gain exposure and manage risk, and borrow and lend for fueling growth and funding new opportunities[3][4].

NYDIG has gained recognition as one of the largest digital asset companies in the United States in terms of assets under custody. NYDIG received significant investments, including a $50 million Series A investment led by Bessemer Venture Partners in 2017, and a $50 million growth equity round of funding in October 2020 led by FinTech Collective[1]. MassMutual also invested $5 million in NYDIG in December 2020, coinciding with its announcement of purchasing $100 million worth of Bitcoin for its general investment account through NYDIG[1]. In the same year, NYDIG's parent company, Stone Ridge Holdings Group, revealed that it held 10,000 Bitcoin, valued at over $115 million, as its primary treasury reserve asset[1]. Additionally, NYDIG introduced its Bank Solutions business in December 2020, allowing banks and fintech companies to access its digital asset platform and develop Bitcoin-related products, including a Bitcoin rewards debit card[1]. The company has recently made news by promoting leaders, partnering with the New York Yankees for bitcoin benefits, and forming an alliance with Deloitte to provide banking for all with bitcoin[3][4]. NYDIG also offers a newsletter for subscribers to stay updated on bitcoin markets, regulatory developments, and important data[3][4].

About HubSpot

HubSpot is a CRM platform offering a suite of software, integrations, and resources to connect marketing, sales, content management, and customer service[5]. The platform consists of products that can be used individually or together to achieve optimal results[5]. The Marketing Hub helps with traffic growth, lead generation, marketing automation, and analytics[5]. The Sales Hub provides insights into prospects, automates tasks, and facilitates deal closures[5]. The Service Hub focuses on customer service, connecting with customers, and turning them into promoters[5]. The CMS Hub offers flexible content management for marketers and powerful features for developers[5]. The Operations Hub synchronizes applications, cleans and curates customer data, and automates processes[5].

HubSpot was founded in 2006 by Brian Halligan and Dharmesh Shah at MIT[6]. The company experienced significant revenue growth, from $255,000 in 2007 to $15.6 million in 2010[6]. They expanded their offerings by acquiring Oneforty, a Twitter app store, and introducing personalized website software[6]. Initially targeting small businesses, HubSpot later served larger companies up to 1000 employees[6]. In 2014, they filed for an IPO and raised over $140 million[6]. HubSpot's stock has performed well, reaching a peak of $841.26 in 2021[6]. They made strategic acquisitions, including Kemvi in 2017 and The Hustle, a content and email newsletter company, in 2021. Yamini Rangan became the CEO in September 2021, while Brian Halligan transitioned to Executive Chairman[6].

HubSpot emphasizes the importance of security, privacy, and control in its products[7]. It offers a comprehensive approach to data security, privacy, and control, providing tools that empower teams to achieve compliance and a secure infrastructure to protect data[7]. HubSpot is trusted by over 121,000 customers in more than 120 countries, including notable organizations such as KPMG, WWF, GoFundMe, Cybereason, LegalZoom, and CancerIQ[7]. The company takes a proactive approach to privacy and security, ensuring that its products meet established standards[7]. HubSpot follows a defense-in-depth approach, implementing multiple layers of security throughout the organization[7]. It complies with industry best practices, such as the OWASP Top 10 and the CIS Critical Security Controls, to continuously improve its security program. HubSpot prioritizes data privacy, ensuring that customer data is protected and used only as permitted in its Customer Terms of Service and Privacy Policy[7]. It offers features like GDPR compliance tools, customizable consent tracking, and subscription settings to help customers comply with data privacy regulations[7]. HubSpot's CRM platform is built on secure software development processes and includes features like SSL certificates, single sign-on, two-factor authentication, and password protection for enhanced security[7]. Customers can access resources like GDPR compliance information, privacy policy details, legal documentation, and security reports through HubSpot's Trust Center[7]. The company also addresses frequently asked questions about its infrastructure, regional data hosting, certifications, encryption, and other security measures[7]. Overall, HubSpot provides software that is secure, reliable, and designed to scale with businesses[7].

HubSpot's CMO predicts that AI will revolutionize business in the future[8]. HubSpot supports its users with free courses, certifications, resources, and a dedicated customer support team[8]. It also has a thriving user community, user groups, blogs, and an app marketplace with numerous integrations[8].

The Reality

Some employees of HubSpot have access to HubSpot accounts. This access is intended to be used to assist customers[9]. Users should be aware that it often includes the past behavioural history of individual users. Such information is highly valuable in creating an effective social engineering attack[9].

“While it is true that financial data is not stored in the CRM, you should be aware that data associated with the users of these companies and their behaviors is logged in the CRM. This puts users in a unique position to be targeted in social engineering attacks.” - HubSpot super admin Robert Warren


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 - NYDIG HubSpot Data Breach
Date Event Description
March 15th, 2022 Social Engineering Attack On March 15th, at an unspecified time, a HubSpot employee fell victim to a social engineering attack which persuaded the employee to provide the necessary credentials and multi-factor authentication.[10]
March 17th, 2022 Client Data Exported It is reported by Hubspot that contact data and user data was exported on March 17th and March 18th through an internal support tool called "just-in-time access" (or JITA)[10].
March 18th, 2023 7:00:00 AM MDT Hubspot Realized Breach HubSpot reports they first "became aware of this unauthorized activity. [They] took prompt action to shut down the bad actor’s access and investigate its impact."[10]
March 18th, 2022 NYDIG Aware Of Security Incident "On Friday, March 18, 2022, NYDIG was made aware of a security incident at one of our vendors. Hubspot, which assists us with email communications and marketing." "Hubspot informed us that a bad actor compromised a Hubspot employee's account and may have gained access to contact information that NYDIG stores with Hubspot, which is limited to: Names, Email addresses, Phone numbers."
March 19th, 2022 Hubspot Issues Press Release FAQ According to HubSpot's website, they published the statement and FAQ on March 19th. (No time is provided and the page was not captured by archive until the following day.) The state that "[o]n March 18, a bad actor compromised a HubSpot employee account and used it to access data within fewer than 30 HubSpot accounts."[11][12] Hubspot also set up a public FAQ page on their website to provide more information. They report the breach exporting contact data from fewer than 30 HubSpot portals, all of which have been notified. HubSpot believes the incident to be targeted at customers in the cryptocurrency industry and has taken measures to terminate access for the compromised employee account and prevent other employees from taking certain actions in customer accounts. Customers who have been impacted by the breach should contact their respective companies for information about what data was shared and any necessary steps they need to take[13][14].
March 20th, 2022 3:41:00 PM MDT nobsbitcoin Tweet About Breach Twitter user nobsbitcoin shares a screenshot of the email which they received from NYDIG reporting on the breach[15]. TBD more details from screenshot.
March 21st, 2022 8:17:00 AM MDT CoinDesk Article Published CoinDesk publishes an article on the incident[16]. They report that a data breach at third-party marketing vendor HubSpot has impacted BlockFi, Swan Bitcoin, NYDIG, and Circle, among others, who maintain their customers' funds are still safe and secure. While user information was leaked to hackers, the affected companies said passwords and other internal information were not affected. HubSpot has not disclosed the full extent of the breach, and an investigation is ongoing. This is copied to Yahoo Finance[17].
March 21st, 2022 10:53:00 AM MDT Cory Klippsten Criticism Swan Bitcoin CEO Cory Klippsten criticizes the industry since close to 30 companies appear to have been breached and fewer than 10 have disclosed it publicly. He announces that his company is severing relations[18].
March 21st, 2022 11:57:00 AM MDT Blockworks Article Published Blockworks publishes an article on the situation. They reported multiple crypto companies were affected including NYDIG, Pantera Capital, BlockFi, Circle and Swan Bitcoin. They report that Pantera Capital was breached a month earlier, and reference a Tweet from a breach a year and a month ago. The data breach saw user information leaked to hackers, but not passwords or sensitive personal information. It is believed to have been a “targeted incident focused on customers in the cryptocurrency industry”. Affected companies maintain customer funds are still safe and secure, and are monitoring the situation closely. The full extent of the HubSpot hack is still unknown and the investigation is reportedly still ongoing[19].
March 21st, 2022 5:05:26 PM MDT Bitcoin Magazine Article Bitcoin Magazine publishes an article on the Hubspot data breach[20]. They report the unauthorized user with "super admin" access exported contact lists and data, including IP addresses, email histories, customer browsing behavior, financial value, and help tickets. While financial data was not compromised, the loss of user persona and behavioral data is severe, and users should expect spear phishing and spam attacks. Users are advised to be cautious of unsolicited communications and to use privacy best practices when browsing, buying, and communicating online[21].
March 22nd, 2022 3:10:55 AM MDT Silicon Republic Article Silicon Republic reports that cryptocurrency companies, including Swan Bitcoin, BlockFi, NYDIG, Pantera Capital, and Circle, were among the 30 affected by a data breach at marketing and sales platform HubSpot. The company confirmed that a “bad actor” compromised an employee account and exported contact data from a small number of customer accounts. While it is unclear what the attacker planned to do with the information, phishing emails have been reported attempting to trick users into submitting their passwords into a fake company website[22][23].
March 24th, 2022 11:11:00 AM MDT ThreatPost Article Published ThreatPost publishes an article on the situation. They report that HubSpot, a marketing platform used by over 135,000 customers, suffered a data breach due to a rogue employee who targeted the company's cryptocurrency customers. At least 30 crypto firms were affected, including BlockFi, Swan Bitcoin, Circle, and NYDIG. The stolen data included contact data, names, emails, account types, phone numbers, and in some cases, company names. While there was no loss of sensitive financial or personal data, such as Social Security numbers or tax IDs, there was the inclusion of a "limited historical snapshot of USD deposits" and about 1.2% of the dataset included clients' intended investment areas or the median net worth of their approximate geographic locales[24].

Technical Details

"On March 15, a bad actor conducted a social engineering attack against a HubSpot employee that captured the employee’s credentials and persuaded the employee to provide the necessary multi-factor authentication. Between March 15 and March 17, the bad actor conducted reconnaissance within HubSpot’s internal systems. On March 17 and March 18, the bad actor exported contact data and user data from certain HubSpot customer accounts via an internal support tool called just-in-time-access (or JITA)."

"A full list of the affected clients has not been published, but [HubSpot] said it appeared to be a “targeted incident focused on customers in the cryptocurrency industry”."

"Since the incident, we have taken steps to enhance our security and to prevent a similar attack from occurring in the future. While our investigation has concluded and remediation completed, we remain committed to improving our security through regular assessments and testing."

"Hubspot says it's around 30 crypto companies in the hack. Fewer than 10 have divulged so far."

Total Amount Lost

The total amount lost is unknown.

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?

"HubSpot said on Saturday (19 March) that it became aware of a compromised employee account the previous day. The company believes data was exported from around 30 of its clients, “all of whom have been notified”."

"The breach has rippled through the crypto industry: As of Monday, crypto lending platform BlockFi, bitcoin-purchasing automation platform Swan Bitcoin, bitcoin company NYDIG, peer-to-peer payments technology company Circle and cryptocurrency fund Pantera Capital (which was hit a month prior) had been affected."

"Adam Healy, chief security officer at BlockFi, said that vendors like HubSpot who are “trusted with client information” are “subjected to a number of reviews.”"

"“However, even in those cases, vendors can make mistakes and as evidenced by Friday’s events have incidents that impact us and our clients,” Healy said in a statement sent to Blockworks."

"The investigation of the bad actor’s activity confirmed that this was a targeted attack focused on customers in the cryptocurrency industry. There was no evidence of suspicious activity within targeted customer accounts after March 18, 2022."

"While it is unclear what the attacker planned to do with this information, Coindesk reported that some users saw an uptick in phishing emails over the weekend, attempting to lure them into putting their passwords into a fake company website."

"To protect yourself, it is important that you exercise extra vigilance and care when reviewing or responding to emails, text messages, and phone calls, particularly those related to NYDIG. NYDIG will never send you an unprompted email to ask for your NYDIG account information, password, or Two-Factor Authentication (2FA) code. NYDIG will never send you an unprompted email providing a public key or wallet address for you to send Bitcoin or other digital assets, and will never request via email that you share any private key."

NYDIG Customer Email

NYDIG issued an email describing the situation to their customers. This was later reposted to Twitter[15].

TBD Quote

"A full list of the affected clients has not been published, but [HubSpot] said it appeared to be a “targeted incident focused on customers in the cryptocurrency industry”."

"Since the incident, we have taken steps to enhance our security and to prevent a similar attack from occurring in the future. While our investigation has concluded and remediation completed, we remain committed to improving our security through regular assessments and testing."

Ultimate Outcome

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

Employee Fired

"[The] rogue employee working at HubSpot – used by more than 135,000 (and growing) customers to manage marketing campaigns and on-board new users – has been fired over a breach that zeroed in on the company’s cryptocurrency customers, the company confirmed on Friday."

FAQ Page Updated

Hubspot reported upgrading security on their FAQ[10]:

Since the incident, we have taken steps to enhance our security and to prevent a similar attack from occurring in the future. While our investigation has concluded and remediation completed, we remain committed to improving our security through regular assessments and testing.

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?

Many Companies Not Disclosing Breach

According to Swan Bitcoin CEO Cory Klippsten reported that HubSpot had indicated "around 30 crypto companies [were affected by] the hack"[18]. The only companies which appear to have reported the breach so far are Swan Bitcoin, BlockFi, NYDIG, and Circle. (Pantera Capital suffered a separate HubSpot breach a year prior, and was not part of this incident.)

General Prevention Policies

Privacy-conscious customers can set up separate email addresses for each service easily, and avoid providing their phone number when possible. Any received emails must be viewed with scrutiny. Interact with companies only through their official websites and confirm anything with the company directly if it promises a significant reward or threatens access to your funds.

Platforms should put in place multi-signature access control on customer data, which requires the approval of multiple people to enable the mass download of data.

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

  1. ↑ 1.0 1.1 1.2 1.3 1.4 1.5 NYDIG - EverybodyWiki Bios & Wiki (Jul 14, 2022)
  2. ↑ 2.0 2.1 2.2 2.3 2.4 2.5 2.6 About - NYDIG - Bitcoin for All Homepage (Jul 14, 2022)
  3. ↑ 3.0 3.1 3.2 3.3 3.4 3.5 3.6 NYDIG - Bitcoin for All - Homepage (Jul 14, 2022)
  4. ↑ 4.0 4.1 4.2 4.3 4.4 4.5 NYDIG - Bitcoin for All Website Archive March 23rd, 2022 11:59:43 AM MDT (Jul 20, 2022)
  5. ↑ 5.0 5.1 5.2 5.3 5.4 5.5 5.6 HubSpot Homepage (Jun 27, 2023)
  6. ↑ 6.0 6.1 6.2 6.3 6.4 6.5 6.6 HubSpot - Wikipedia (Jun 27, 2023)
  7. ↑ 7.00 7.01 7.02 7.03 7.04 7.05 7.06 7.07 7.08 7.09 7.10 HubSpot Security Program - Hubspot Website (Jul 20, 2022)
  8. ↑ 8.0 8.1 8.2 HubSpot Homepage (Jun 27, 2023)
  9. ↑ 9.0 9.1 HubSpot Data Breach Ripples Through Crytocurrency Industry - Threatpost (Jun 20, 2022)
  10. ↑ 10.0 10.1 10.2 10.3 Information About HubSpot's March 18, 2022 Security Incident - Hubspot Website (Jun 26, 2022)
  11. ↑ HubSpot's Statement Regarding March 18, 2022 Security Incident - Hubspot Website (Jul 20, 2022)
  12. ↑ HubSpot's Statement Regarding March 18, 2022 Security Incident - Hubspot Website Archive March 20th, 2022 6:18:05 PM MDT (Apr 24, 2023)
  13. ↑ Information About HubSpot's March 18, 2022 Security Incident - Hubspot Website (Jun 26, 2022)
  14. ↑ Information About HubSpot's March 18, 2022 Security Incident - Hubspot Website Archive March 20th, 2022 8:03:24 PM MDT (Apr 24, 2023)
  15. ↑ 15.0 15.1 nobsbitcoin - "NYDIG Customer Data Leak - names - email addresses - phone numbers" - Twitter (Jul 20, 2022)
  16. ↑ HubSpot Hack Leads to Data Breaches at BlockFi, Swan Bitcoin, NYDIG and Circle - CoinDesk (Apr 24, 2023)
  17. ↑ HubSpot Hack Leads to Data Breaches at BlockFi, Swan Bitcoin, NYDIG and Circle - Yahoo Finance (Jul 20, 2022)
  18. ↑ 18.0 18.1 Cory Klippsten - "Hubspot says it's around 30 crypto companies in the hack.  Fewer than 10 have divulged so far." - Twitter (Jul 20, 2022)
  19. ↑ NYDIG, BlockFi, Pantera, Circle All ‘Targeted’ in HubSpot Data Breach - Blockworks (Jul 20, 2022)
  20. ↑ How HubSpot Data Breach Hits Bitcoiners - Bitcoin Magazine Archive March 21st, 2022 5:05:26 PM MDT (Apr 25, 2023)
  21. ↑ How HubSpot Data Breach Hits Bitcoiners - Bitcoin Magazine - Bitcoin News, Articles and Expert Insights (Jul 19, 2022)
  22. ↑ HubSpot hack leads to multiple Web3 and crypto company data breaches - Silicon Republic (Jun 26, 2022)
  23. ↑ HubSpot hack leads to multiple Web3 and crypto company data breaches - Silicon Republic Archive March 22nd, 2022 4:07:55 AM MDT (Apr 24, 2023)
  24. ↑ HubSpot Data Breach Ripples Through Crytocurrency Industry - Threatpost (Jun 20, 2022)

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