Bitcoin Value Plunged after Great Theft of Coins from Exchange

Nearly 120,000 Bitcoins worth approximately $78m have been stolen from Hong Kong-based exchange Bitfinex, resulting in immediate 20% drop in the value of the currency. According to the popular cryptocurrency exchange, the hack is estimated as the largest of its kind and limited to Bitcoin wallets held by Bitfinex. The incident forced the exchange to cease its operation and report to law enforcement.

Bitfinex has published a statement on its website, telling its customers that the company is investigating the breach in attempt to figure out what happened, but it is already clear that some of its customers have had their Bitcoins stolen. Bitfinex is currently undertaking a review to find out which customers have been affected by the hack.

According to the director of community and product development for the cryptocurrency exchange, more than 119,000 Bitcoins were stolen from Bitfinex users’ segregated wallets. Following this news, the value of Bitcoin fell nearly 20%, according to data from CoinDesk, as the stolen cryptocurrency makes up about 0.75% of all Bitcoins in circulation.

Bitcoin experts confirm that Bitfinex is the biggest USD exchange, so everyone has an account with it (except for China). The cryptocurrency exchange was assessed as very liquid, providing the ability to trade on margin and having lots of daily volume.

So far, security experts cannot tell whether the breach was an inside job or hackers managed to gain access to the system externally. Financial experts are also not sure whether the theft can force Bitfinex into bankruptcy. You may remember that a similar loss of cryptocurrency from the biggest exchange at the time, MtGox, forced it into bankruptcy protection 2 years ago and led to the arrest of its CEO Mark Karpeles in Japan.