Auditing Firms Claim Crypto.com Lost $15 Million in Incident as Users Report Suspicious Activity CryptoBlog

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Crypto.com, one of the leading cryptocurrency exchanges, experienced an incident on January 17 when some of its users reported strange activity on their accounts. The exchange acknowledged the event and conducted an investigation immediately afterwards, stating that all funds were safe. However, reports from security and blockchain audit firms Certik and Peckshield indicate that some funds have been withdrawn from exchange wallets.

Crypto.com Suspends Withdrawals After Suspicious Activity Reported

Crypto.com, a cryptocurrency exchange, suspended normal withdrawal operations after customers reported experiencing suspicious activity on their accounts. In its first statements, the exchange told clients that all funds were safe. The reports led to improved security measures being applied to access accounts, with all customers having to log back into their accounts. Additionally, two-factor authentication (2FA) for all accounts had to be reset.

Some customers have complained about not being able to reset their two-factor authentication keys, and others have reported not being able to access the exchange as a result. After the exchange resumed withdrawals, Kris Marszalek, CEO of Crypto.com, reported on what happened, stating that the total downtime of the withdrawal infrastructure was around 14 time. The exchange has introduced a new security measure: customers will not be able to opt out of whitelisted addresses within the first 24 hours after registering on the platform.

Marszalek reiterated that no user funds were lost and that the company would offer a full autopsy after its investigation.

Blockchain audit firms report otherwise

While Crypto.com has repeatedly stated that no user funds are affected, there are conflicting statements on the matter. Certik and Peckshield, two security and blockchain auditing firms reported otherwise. Peckshield said the exchange lost $15 million, or 4.6,000 ETH during the event, and half of those funds were laundered using Tornado.cash, an anonymity-based protocol. which allows users to perform private transactions.

Certik, another auditing firm, corroborated Peckshield’s report, saying the funds were being sent to Tornado.cash. More importantly, Certik informed its followers that it had compiled a list of addresses of users who would have been affected by the event, and the number of ether subtracted from each of those accounts. The company said 282 accounts were affected.

The cause of the event is still unknown. Neither Peckshield nor Certik have conclusively stated what happened, and Crypto.com is still conducting an internal investigation into the matter at the time of writing.

What do you think of the suspicious activity experienced by Crypto.com customers? Tell us in the comments section below.

Sergio Goschenko

Sergio is a cryptocurrency journalist based in Venezuela. He describes himself as late in the game, entering the cryptosphere when the price spike happened in December 2017. Having a background in computer engineering, living in Venezuela and impacted by the cryptocurrency boom at the social, it offers a different point of view. on the success of crypto and how it helps the unbanked and underserved.

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