Lykke Exchange in the UK Halts Trading After 22 Million Hack
Lykke, a prominent British cryptocurrency exchange, has recently made waves in the crypto world by suspending its trading services following a potential hack that resulted in a loss of approximately $22 million. This incident has brought significant security concerns to light, underscoring the inherent risks associated with digital currency exchanges.
The hack, characterized as an “unauthorized access” to the platform, was first identified by web investigator SomaXBT. This breach led to substantial outflows of various digital assets, including Bitcoin, Ether, Litecoin, and Bitcoin Cash, as indicated by on-chain data. Taylor Monahan, a MetaMask developer and crypto security analyst, was among the first to flag the unusual transactions.
Shortly after signs of the network breach emerged, Lykke took swift action by suspending all trading activities to prevent further losses. To obscure the trail of the stolen ether, the hackers promptly converted the funds into DAI, a commonly used cryptocurrency for such illicit purposes.
In response to the hack, Lykke’s CEO, Richard Olsen, reassured customers that their funds were secure despite reports of missing balances in accounts. Olsen emphasized the company’s financial stability, stating, “Your money is safe because Lykke is a diversified entity with ample cash reserves.”
Acknowledging the severity of the situation, Lykke confirmed via a tweet that both Lykke UK and Lykke Corp AG had been targeted in the attack on June 4th. The exchange took immediate action by shutting down several systems to prevent further damage and promptly addressing the identified security vulnerabilities. An internal investigation into the attackers is ongoing, with legal authorities launching a criminal investigation into the breach.
To bolster their response efforts, Lykke enlisted the support of an external cybersecurity firm to enhance security measures, recover lost assets, and prevent future thefts. Despite the disruption caused by the trading halt, Lykke remains committed to resolving the issue and ensuring the safety of client funds.
The hack has underscored the need for heightened vigilance in the crypto ecosystem, with Lykke diligently working to address the breach and restore normal operations. The incident serves as a stark reminder of the persistent challenges faced by digital currency exchanges and the importance of robust cybersecurity measures.