Cryptocurrency derivatives exchange Deribit has reportedly stopped withdrawals post sustaining a $28 million hot wallet hack, as reported by Cointelegraph.
According to Cointelegraph, Deribit exchange got its hot wallet compromised prior to midnight of November 1, 2022, as has been reported by the firm on Twitter.
“Client assets, Fireblocks or any of the cold storage addresses are not affected. It’s company procedure to keep 99% of our user funds in cold storage to limit the impact of these type of events,” the exchange stated.
On the basis of information by Cointelegraph, on account of the security checks, Deribit had to stop its withdrawals, including custodians Copper Clearloop and Cobo, until the exchange gets completely sure about the security after the hack. “Deposits already sent will still be processed, and after the required number of confirmations, they will be credited to accounts,” the firm added.
It is believed that Deribit’s insurance fund will not be affected by the hack, as the exchange is expected to compensate for the loss as well. A Deribit’s spokesperson stated that about the company’s aim to resume withdrawals as soon as possible, and is reportedly going through all the needed security measures. Reportedly, the platform has also started working on a full incident review to give additional information about the vulnerability that could have been the cause behind the issue. The hack was the first time Deribit experienced such an attack and losses post the company’s launch, the representative mentioned.
Moreover, Cointelegraph noted that Deribit was founded in 2016, and is considered to be one of the largest cryptocurrency derivatives exchanges in the world, on account of allowing users to trade cryptocurrency futures and options. At the time of the publication’s writing, Deribit’s daily trading volume stood at $280 million, as per data provided by CoinGecko.
(With insights from Cointelegraph)
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