Cryptopia Liquidation Hack

Notice: This page is a freshly imported case study from the original repository. The original content was in a different format, and may not have relevant information for all sections. Please help restructure the content by moving information from the 'About' section to other sections, and add any missing information or sources you can find. If you are new here, please read General Tutorial on Wikis or Anatomy of a Case Study for help getting started.

Cryptopia

It seems fairly certain that the funds were not stored in a multi-signature wallet, and may even have been connected to an online system. It's possible that only a portion of the tokens were taken since the others were locked into a staking contract.

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

About Cryptopia

"Controversy still surrounds a liquidated New Zealand cryptocurrency exchange, which allegedly got hacked again. Adding to the $30 million stolen in 2019, Cryptopia reports that it was the target of another theft incident on February 1, 2021." "Cryptopia’s liquidators were appointed in May 2019 to start the process of shutting down the crypto exchange."

"Cyber fraudsters withdrew $ 45,000 worth of crypto assets from the New Zealand bitcoin exchange Cryptopia, which has been in the process of liquidation since 2019." "Liquidator Grant Thornton New Zealand said it hadn’t authorized the movement of funds and that it is investigating the incident, according to an email seen by Stuff." "The news comes soon after Grant Thornton finally started allowing former users of the exchange to enter claims to retrieve their assets."

"The wallet belongs to Stakenet and is under the control of Cryptopia’s liquidators, Grant Thornton. Per the findings, the dormant wallet was holding around $1.96 million worth of XSN, Stakenet’s native token." "According to Stuff.co.nz, the hackers took around NZD 62,000 ($45,000) worth of cryptocurrencies from the troubled exchange. The alert first came from Stakenet, a U.S.-based blockchain firm." "An email, seen by Stuff, from Grant Thornton’s Tom Aspin to Stakenet said it was investigating the transaction, which was not authorised by the liquidator." "Grant Thornton did not respond to requests for comment. It is understood the liquidator has contacted police about the alleged theft." "As of press time, they haven’t addressed the recent alleged hack publicly." "The incident is under investigation."

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

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 - Cryptopia Liquidation Hack
Date	Event	Description
February 15th, 2021 12:00:00 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

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?

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

It is unknown how much was recovered.

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

This type of breach can be prevented through moving funds into an offline multi-signature wallet, which is controlled by trusted and trained individuals.