Bitfinex hack Archives

History of insurances in cryptocurrency world:

A formerly existing wallet service named Elliptic Vault was probably the first ever insured bitcoin service. They launched in January 2014 and named Lloyd’s as their insurer. Unfortunately, Lloyds backed out of the deal, but the service was able to find another insurer, CBC insurance. Following this, the Great American Insurance Company offered the first official Bitcoin Insurance coverage policy to businesses. Later, bitcoin vault Xapo announced that they were using AMBest to insure their high-security vaults. Following year, Coinbase and BitGo made insurance protection a common feature in the largest bitcoin wallet services.

What Mitsui Sumitomo offers?

Mitsui Sumitomo is offering a unique policy for Bitcoin exchanges around the world. The plan’s total theft cover ranges from ten million yen (US$88,500) up to one billion yen (US$8.85 million). In addition to theft, it also covers loss from internal and external threats, including employee theft, mistakes, cyberattacks, and other unauthorized access. Additional to the recovery amount, the policy comes with a range of damage control and prevention services.

The plan’s announcement states:

“In order to prevent damage caused by cyber-attacks, targeted mail training and information leakage risk, we provide cyber risk countermeasure services such as security diagnosis and checklist for employees.”

First takers:

The new insurance product was developed in partnership with Japan’s largest exchange, Bitflyer. The exchange helped develop a policy that protects against losses at both the exchange and customer levels, and is the also the first policyholder. BitFlyer now accounts for an overwhelming 68 percent of the yen trading volume.

September has been a fairly positive month for the cryptocurrency with steady adoption and acceptance. With no major fundamental news in the market, the Bitcoin prices have consolidated over $600 level. With the prospects of legislation in the favor of the digital currency and its underlying technology cropping up, the market sentiment has been supportive for the prices. Let’s look into how BNP Paribas is leveraging blockchain and contributing to the growing mainstream adoption this month:

BNP to use ledger technology for mini – bonds:

French bank BNP Paribas’ Securities Services has unveiled their blockchain platform on which they have been working. This platform will enable private companies to lend money to business using mini-bonds in exchange for company shares. The distributed ledger platform that will support and record mini-bonds issued through the platform. BNP is partnering with French crowdfunding startups Enerflip, Lendosphere and Lumo for seamless execution of the platform. BNP Paribas Securities Services’ Innovation & Digital Lab head of business management Marc Younes had positive hopes from the platform. He said that the platform is one that stands to benefit small businesses, while potentially helping standardize mini bond management.

Younes said:

“Blockchain technology is particularly suited to the fundraising needs of private companies as transactions volumes are typically lower than for listed companies.”

Bitfinex updates Bitcoin Hack repayment plan:

Bitfinex has taken new steps to reimburse accountholders who lost funds in an exchange breach earlier this year. In a blog post, the troubled exchange announced two special purpose vehicles (SPVs) would be made available to accountholders. This is for the purpose of exchanging digital assets for interest in iFinex Inc, Bitfinex’s parent company. The exchange issued the assets, called BFX tokens, to accountholders after suffering a 120,000 BTC($72m) hack on 2nd August.

After the hack, Bitfinex has been trying its best to keep up its promise

While people were skeptical towards the issuance of these tokens , Bitfinex has provided accountholders with positive signs. On 1st September they redeemed more than 1% of the tokens for $1, even though it was below market price.

Viatnamese Bitcoin MLM Scheme sees deposit of $ 1 million:

An MLM-based investment scheme that used bitcoin as its transactional currency has gone bust, in Vietnam. A Vietnamese investment scheme used multi-level-marketing (MLM) and bitcoin as its currency to promise investors returns of 144% a month. MLM trading is illegal by law in Vietnam, as deemed by the Vietnam Competition Authority (VCA). But this didn’t stop unsuspecting users from pouring money into the scheme. The Ponzi scheme first surfaced in January this year. It used the domain “fxmt4.us”, seeking participants to register with an account. It demanded a minimum deposit of 1 bitcoin as the buy-in, according to local publication ‘Thanh Hien’.

Early investors saw early returns, fueling the interest among residents. But by May, the scheme was no longer paying out dividends and the domain went offline. A preliminary investigation revealed that the money invested in the scheme is around $1 million.

This shows how nascent cryptocurrencies can be misused for fraudulent activities, especially when their adoption is on the rise.

Tag: Bitfinex hack

Bitcoin Exchanges can now be covered for Theft: Mitsui Sumitomo Insurance offering a unique policy