The Strategist

Hackers stole Bitcoins worth $ 65 million

08/03/2016 - 13:27

On Tuesday, Hong Kong Bitfinex, one of the largest trade areas conducting transactions with Bitcoin, suspended its work due to a hacker attack. This resulted in almost 120 thousand BTC ($ 65 million) stolen from customer accounts. Quotes of the digital currency immediately collapsed: during the trading, value of one Bitcoin fell from $ 605 to $ 480.

BTC Keychain
BTC Keychain
Bitcoin’s quotes on Tuesday fell back to two-month low after hacking of one of the largest digital currency exchanges. In its blog, Hong Kong Bitfinex told about a breach in the company's security system. The hackers stole almost 120 thousand Bitcoins from customer accounts. The sum is equivalent to about $ 65 million. All operations on the stock exchange were immediately suspended.

Such a major theft immediately affected mood of investors in cryptocurrency. Once the message was published, Bitcoins quotes streamed down. At the time of the press release’s publication, market price of one Bitcoin was about $ 605. Just a few hours later, its value plummeted by 20%, dropping to $ 480 in the course of trading, that is, to its lowest since mid-May. Then, however, the cryptocurrency managed to partially recover, up to $ 540-545.

Bitfinex said it had to freeze the customers’ accounts, and to discontinue any operations on the stock exchange. The company appealed to law enforcement authorities to clarify all the details of what happened, and to catch the hackers themselves. "During the investigation, we will examine all possible options on how we can restore the loss of customers. We ask the community to be patient while we try to find out causes and consequences of the hacking, "- said Bitfinex in the statement.

Despite the fact that Bitcoin managed to become a temporary refuge for investors in tough economic times, the digital currency hasn’t justified itself as a long-term means of saving resources. Over the years, it has experienced sharp rises of up to $ 1,200 per BTC, and subsequent falls to the level of just above $ 200. On the other hand, if we look at Bitcoin’s quotes over the past year and a half, the currency’s stable growth becomes obvious. CoinDesk’s report ‘The State of Bitcoin and Blockchain’ shows that fluctuations in the first quarter reached minimum values for the last two years. 

Bitcoin is, above all, a technology, not money or a store of value. Accordingly, movement of his quotations in the long term can be compared to development of any technology. We could take Gartner’s Hype Cycles as a possible predictor of what will happen in the future, Bitcoins, and then find out that so far, rate of the digital currency is fully correlated with the schedule of maturity cycle technologies. This means that now Bitcoin, perhaps, goes to the "plateau of maturity", i.e. a period of stabilization associated with introduction and mass adoption of any technology. In this case, this is the "blockchain" technology, which is essentially the very idea of Bitcoin.