December 7, 2017

Nearly $64m of bitcoin lost in NiceHash hack

The rising price of the cryptocurrency bitcoin doesn’t show any signs of slowing down. This is making the digital currency attractive to hackers.

The cryptocurrency marketplace NiceHash has reported that a security breach has compromised the contents of its bitcoin wallet. It’s thought nearly $64m has been lost in the hack.

The Slovenia-based marketplace connects bitcoin miners with people who have the computing power to allow them to mine for the digital currency. At current rates, bitcoin mining could soon use up as much electricity as the US.

It revealed details of the NiceHash bitcoin hack through its Reddit account. NiceHash said it was investigating the incident and is working to verify the precise number of bitcoin taken. However, the company’s head of marketing, Andrej P. Skraba told Reuters it’s likely to be around 4,700 bitcoin stolen, amounting to $63.92m in current prices.

NiceHash said:

“Clearly, this is a matter of deep concern and we are working hard to rectify the matter in the coming days. In addition to undertaking our own investigation, the incident has been reported to the relevant authorities and law enforcement and we are co-operating with them as a matter of urgency.”

The marketplace also warned users of the site to change their online passwords as a precaution.

The problems with cryptocurrencies are stacking up.

Hacking concerns surrounding cryptocurrencies like bitcoin and ether, as well as its volatility issues, are one of the reasons it is taking so long for digital currencies to become more mainstream.

This week, Wall Street banks have warned against introducing bitcoin futures for institutional investors. This is a type of contract whereby users agree to buy or sell a specific amount of bitcoin once it reaches a certain price on a future date.

The Commodity Futures Trading Commission (CFTC) in the US gave the green light for the Chicago exchanges, CME Group and CBOE Global Markets, to launch future contracts. This was set to take place in the next 10 days.

However, the Future Industry Association, the main futures lobby group, has warned against introducing cryptocurrency futures. In a letter to the CFTC, the association said the financial system is “ill-prepared” for cryptocurrencies and the launch of bitcoin contracts.

This is because of the volatility of the currency, causing it to hit $14,000, up from $6,000 less than two months ago.

And with governments announcing plans to regulate cryptocurrencies, mainstream bitcoin usage looks like it’s still a long way off.

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