Technology |Emerging

Cryptocurrency site NiceHash confirms hack

NiceHash, a cryptocurrency mining marketplace, confirmed that its security has been breached and “the contents of the NiceHash Bitcoin wallet have been stolen.” Its users said in online forums that their balances are zero and that more than $60 million was moved to a Bitcoin wallet on December 6. 

CEO Marko Kobal and co-founder Sasa Koh appeared on a Facebook video  to address users’ concerns. Kobal said the hack was made by using the credentials of a NiceHash engineer and that they’re conducting a forensic investigation with law enforcement. He added that more information will be given in the coming days.

Reuters also reported that NiceHash head of marketing Andrej P. Škraba said that the hack was “a highly professional attack with sophisticated social engineering.”

Nervous users first began speculating about a possible hack on Reddit and Twitter after the site said it was down for maintenance that morning.

Later in the day, WikiTribune was in contact with company adviser Andrej Nabergoj, who said that NiceHash was “assessing the situation and working with the authorities.” WikiTribune initially identified Nabergoj as CEO, but he subsequently clarified his position.

A press release from NiceHash was later posted on Reddit and Twitter, which said that the company’s security has been breached.

NiceHash is a place for users to buy “hashing power,” that is computing power for mining different cryptocurrencies such as Bitcoin. On Thursday, the price of Bitcoin surged to $15,000.

Cryptocurrencies are digital assets that run on a technology called blockchain – a decentralised ledger that allows for anonymous and secure peer-to-peer transactions. Mining is the process of adding transaction records to the blockchain.

More than $60 million from NiceHash users has apparently been moved to a single external wallet pointing to this address.

This security breach of NiceHash makes it one of the biggest cryptocurrency breaches ever. The biggest hack was in 2014, when Mt. Gox, then the world’s largest Bitcoin exchange, lost $460 million, as reported by Wired. The second biggest breach of a Bitcoin exchange platform was Bitfinex in 2016, which had $77 million stolen.

The company’s first tweet regarding maintenance was posted early December 6, and it posted another four hours afterwards, which only added to the concerns expressed on social media by people identifying themselves as NiceHash customers. Users on the Reddit page also said that the company stopped responding to support queries around a day or two ago.

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Talk (5)

Joel Gallant

"Thanks Linh. This is a really inte..."

Linh Nguyen

"Thanks Joel. An explainer on how wall..."

Joel Gallant

"I know that WT wrote a great article ..."

Peter Bale

"Thanks. Good points. We aim to do a l..."

Author

Linh is a staff journalist at WikiTribune with a background in the humanities. She covers the Middle East, Asia, conflict and technology. Though based in London, she has freelanced across Asia, the UK and U.S.

Cryptocurrency site NiceHash confirms hack

Talk about this Story

  1. Other

    I haven’t jumped into the whole cryptocurrency as of yet, but this is the part that makes me nervous.

    I know that this isn’t the first theft of Bitcoin or other Cryptocurrency; however, how do we move to protect those investments when it’s decentralized and such?

    1. Thanks. Good points. We aim to do a lot more on this area. Your ideas are welcome.

      1. Rewrite

        I know that WT wrote a great article on blockchain and such, but I think having a better understanding of how wallets work would be great.

        When I first started researching wallets and I never realized that a wallet wasn’t the same as a wallet that you carry in your pocket. For example, some can only hold Bitcoin while some can hold multiple currencies.

        The other thing is there only seems to be discussion around Bitcoin in the world. I’ve read articles, including here on WT which says that there could be as much as a thousand different cryptocurrencies.

        Cryptocurrencies are certainly interesting and I’m interested in seeing where they will lead and take us in the future.

        1. Rewrite

          Thanks Joel. An explainer on how wallets work is a good idea, I’ll see what I can do.

          And yes, Bitcoin is the most well-known because it was the first cryptocurrency. Others worth checking out are Ethereum, Dash and Bitcoin Cash. But there are thousands.

          1. Rewrite

            Thanks Linh.

            This is a really interesting topic and I think it’s going to change the economy; however, I’m not sure if it’s going to be for the positive or negative yet.

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