- One of the largest cryptocurrency exchanges shut Tuesday morning because of a cyber attack.
- “The platform is under extreme load,” Bitfinex said at 9:39 a.m. ET.
- Bitcoin was trading slightly lower at $7,421 a coin, according to Markets Insider data.
Bitfinex, one of the largest cryptocurrency exchanges by trading volumes, was down Tuesday morning after it experienced a cyber attack.
According to its incident page, the exchange shut early Tuesday morning after it experienced problems with its trading engine. For a short period the exchange was back online after the issue was addressed. But the exchange was then hit with a so-called denial-of-service attack, which is when a network of virus-infected computers overwhelm websites with massive amounts of data.
“The platform is under extreme load,” the exchange said at 9:39 a.m. ET. “We are investigating. Seems a DDoS attack was launched soon after we relaunched the platform.”
Still, clients’ funds were not impacted, according to a statement by Kasper Rasmussen, head of marketing at Bitfinex.
“The attack only impacted trading operations, and user accounts and their associated funds/account balances were not at risk at any point during the attack,” Rasmussen said in a statement. “We will continue to update our user base on any further disruptions to service.”
Crypto exchange outages were common at the end of 2017 as bitcoin soared to all-time highs near $20,000, but have been less common in 2018 as prices and volumes across the digital coin market have fallen back to earth.
In 2017, the breakneck growth of the market forced some exchanges to stop onboarding new users altogether. A flash crash at Bitfinex in December left customers demanding answers and refunds.
Hacks and cyber attacks have long been a problem for the crypto space. Notably, Mt. Gox, which was the world’s largest bitcoin exchange, witnessed a massive DDoS attack in 2013. It shut in 2014 after a $450 million hack. JPMorgan estimates that a third of bitcoin exchanges have been hacked.
“Running an exchange is one of the most complex server-side operations out there,” Kyle Samani, a crypto fund manager, told Business Insider.
“On an exchange, everyone wants real time, all the time, globally and the bots are hitting the APIs every few milliseconds both to get order book updates and to trade,” Samani added. “Doing this at scale is much harder than almost any other application.”
Still, Gabor Gurbacs, the director of digital asset strategy at VanEck, told Business Insider he thinks exchanges are getting better at handling technical issues and communicating with clients.
“Recently, exchanges started to halt trading, especially important for margin trades, and provided timely and more transparent notes to customers in cases of service disruptions,” Gurbacs said. “It’s a sign of maturation in my view.”
2018’s less volatile trading environment has given exchanges an opportunity to catch their breath. Bitfinex didn’t experience any technical incidents in the entire month of May.
Bitcoin was trading lower in the aftermath of the DDos attack. The cryptocurrency was down 1.04% at $7,421 a coin, according to Markets Insider data.