Bitfinex
Bitfinex is a crypto-currency exchange trading and currency-storage platform based out of Hong Kong and owned and operated by iFinex Inc.[1][2] Since 2014, it has been the largest Bitcoin exchange platform, with over 10% of the exchanges' trading.[3] In 2016, Bitfinex was hacked, and $72 million in bitcoin was stolen from its customers.
History
In 2016, Bitfinex was the subject of the Bitfinex hack. In it, $72 million in bitcoin was stolen from the company's customer's accounts.[4] Immediately thereafter, bitcoin's trading price plunged by 20%.[5] After learning of the breach, Bitfinex halted all bitcoin withdrawals and trading.[2]
In that hack, the second-biggest breach of a Bitcoin exchange platform, 119,756 units of bitcoin,[5] which was about $72 million at the time, were stolen. Bitfinex first announced the security breach on August 2, 2016. The bitcoin was taken from users' segregated wallets and Bitfinex said it was tracking down the hack.[6] Significant hacker funds transactions were signed off by Bitfinex's security provider, without full security.[7]
Shortly after the hack, Bitfinex created BFX tokens, which were used to represent customers' stolen equity. The BFX tokens represented $1 and were issued to account for the value of customers cryptocurrencies at the time of the hack. In April of 2017, Bitfinex announced they had bought back all of the BFX tokens, essentially paying back all of customers lost funds.[8] Some customers found this repayment to be inadequate, as the price of Bitcoin had nearly doubled in the time it took Bitfinex to repay customers. Despite many customer complaints, Bitfinex has continued to grow in market share of cryptocurrency trading.
2017 withdrawal and pricing
In April 2017, Bitfinex announced that it was no longer able to let users withdraw their funds in USD,[9] after Wells Fargo placed limitations on its wire transfers.[10] Bitfinex sued Wells Fargo for the decision but dismissed the case few days later.[11][12] As a consequence, Bitcoins were traded at a price around 100 USD higher than other exchanges[13][14] as users started buying bitcoins in order to move them to other exchanges and withdraw their funds there.[15][16]
See also
- Mt. Gox, which preceded Bitfinex as the world's largest bitcoin exchange, lost 850,000 bitcoins belonging to customers and the company in 2014.
References
- ^ "Bitfinex - crunchbase". www.crunchbase.com.
- ^ a b Bitcoin security breaches raise questions about digital currency's future - CSMonitor.com
- ^ "Bitcoinity.org". data.bitcoinity.org.
- ^ Bitfinex comes back from $69 million bitcoin heist - SFGate
- ^ a b [1]
- ^ "Bitcoin Worth $72M Was Stolen in Bitfinex Exchange Hack in Hong Kong". Fortune. Retrieved 26 October 2016.
- ^ Suberg, William. "Bitfinex Hack: US Regulation 'Prevented Cold Storage Use'".
- ^ https://buy-ethereum.io
- ^ "Bitfinex". www.bitfinex.com.
- ^ "Wells Fargo Lawsuit Shows Banks Still Doubtful of Bitcoin: Report - CryptoCoinsNews". 12 April 2017.
- ^ "Bitcoin Exchange Sues Wells Fargo - PYMNTS.com". www.pymnts.com.
- ^ "Bitfinex files for voluntary dismissal". Mark Karpelès.
- ^ "Bitcoin price". 2017-05-02. Archived from the original on 2017-05-02.
{{cite web}}: Unknown parameter|deadurl=ignored (|url-status=suggested) (help) - ^ "Bitcoin Price Sets New Single Exchange All-Time High - CoinDesk". 26 April 2017.
- ^ "Bitcoin Trading at a Near $100 Premium on Bitfinex - CryptoCoinsNews". 21 April 2017.
- ^ Redman, Jamie (27 April 2017). "Bitfinex Price Spreads Bring Uncertainty to Bitcoin's Price Rally - Bitcoin News".
External links
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