Yesterday, we saw news of another hack of the South Korean cryptocurrency exchange, Bithumb, the hack, resulted in the theft of over $30 Million. Just over a week ago, we also saw a similar scale hack take hold of (another South Korean cryptocurrency exchange) Coinrail, this time, we saw theft in excess of $40 Million.
In just two weeks, over $70 Million worth of cryptocurrencies have been stolen. A few months ago, events of this nature would have pounded market values down, yet today, even in the wake of this news, the markets are behaving quite predictably and relatively smoothly. Why hasn’t a loss of $70 Million pushed the markets down, in the way we would expect, at least?
It seems as if now, traders and investors are starting to get ‘used’ to these sorts of attacks and thus, are not behaving irrationally as a result of them. Though it is very unfortunate, it seems mass loss is starting to become a normal part of day to day life as a cryptocurrency investor. If this is the case, cybersecurity clearly isn’t up to scratch, but I guess that’s a discussion for another day.
So, with hacks and attacks becoming more prominent, it does seem as if the community is becoming immune to responding to these. Likewise, though, the response from exchanges is starting to change, that in turn is n doubt encouraging people to remain a little, calmer, in the wake of these incidents.
For example, yesterday, from the outset of the Bithumb hack, the company closed their network straight away, in order to minimise the damaged caused. Within this, they also released an update to their community, urging them to remain calm. Most importantly, Bithumb promised to compensate customers and reimburse those who had lost assets as a result of this. By reacting in this way and encouraging a bit of a ‘keep calm and carry on attitude’ Bithumb helped to ensure that this hack didn’t encourage people to back away and start selling cryptocurrencies, thus causing market prices to plummet. Instead, they took control of the situation before this was able to happen.
So, really, it seems that solidarity through a combination of people being less anxious about hacks and exchanges doing more in response to hacks, the markets are becoming less sensitive to these sorts of cybercrime. Granted, it is a sorry state of affairs that traders are having to simply ‘get used’ to the fact their assets could be stolen in an attack, but, at the very least it is good that we are seeing the markets learn to balance themselves as a result of these attacks, instead of instigating all out panic, much like we have seen in the past.
Hopefully, exchange hacks will merely be a thing of the past, once these ‘so-called’ security experts start picking up their pace, at least.