Hackers Steal $5.4 Million in Bitcoin from Exchange

Jan. 8, 2015

Hackers Steal $5 Million in Bitcoin from Exchange Bitstamp, the bitcoin exchange based in Slovenia, said a network intrusion last Sunday resulted in the theft of 19,000 bitcoins. The company said the total lost in the breach (worth $5.4 million as of this morning, according to CoinDesk’s Bitcoin Price Index) represents “a small fraction” of its total bitcoin reserve. The exchange suspended trading on Monday and said it would remain closed until it was able to repair its systems. The company stressed to customers it had the liquidity to cover the loss.

“We would like to reassure all Bitstamp customers that their balances held prior to our temporary suspension of services will not be affected and will be honored in full,” the exchange said in a statement.

While the hack is a black eye for Bitstamp, the news hasn’t met with the same angst as the larger intrusion last year of Mt. Gox, which, until then, had been the largest bitcoin exchange. Even while the value of bitcoin as an investment has steadily eroded since then, its value as a possible disruptive payment method has endured. Regulators are taking a closer look at cryptocurrencies with an eye toward bringing them into the fold as an accepted online payment method. And, organizations advocating for bitcoin and other virtual currencies are taking the lead on education and lobbying state and federal governments.

“[When an event like this happens, legislators] want to know: Is bitcoin flawed? What happened?” said Perianne Boring, president of the Chamber of Digital Commerce, which is working in the U.S. to educate lawmakers on digital currencies. “We have access and are able to explain this is a security flaw in a company, not in bitcoin generally. It’s about being part of the dialogue.”