On April 9th, South Korean cryptocurrency exchange GDAC suffered a massive hack, losing approximately $13 million across various cryptocurrencies. The hackers targeted the exchange’s hot wallet, which contained 23% of GDAC’s total holdings.
The stolen assets included 60.8 Bitcoin (BTC), 350.5 Ethereum (ETH), 10 million WEMIX tokens, and 220,000 USDT. WEMIX is the native token of the eponymous crypto network.
GDAC has stated that it is working closely with domestic and foreign crypto exchanges and issuers to prevent the stolen coins from being laundered and recover them. Additionally, the exchange has informed the Korea Internet & Security Agency, the Korea Financial Intelligence Unit, and the police of the incident.
Notice on #GDAC Exchange Hack Alert⚠️
GDAC Exchange has officially announced that it has experienced a security breach
Please refer to the official announcements made by the Exchange👇
▶️GDAC Announcement: https://t.co/SNRFZTMEYg
WEMIX Medium: https://t.co/7UIwyua72K
— WEMIX (@WemixNetwork) April 10, 2023
Hot Wallet Vulnerabilities
Crypto exchanges use hot wallets to store a portion of their funds that are available for immediate withdrawals and trading activities. However, hot wallets also come with security risks, as they are connected to the internet. This makes them vulnerable to hacking attempts and, if compromised, can result in significant financial losses for the exchange and its users.
GDAC CEO Seunghwan Han confirmed that the exchange’s wallet system and related servers were immediately suspended and blocked as soon as the incident was confirmed.
Cryptocurrency Theft on the Rise
Last year saw a surge in cryptocurrency theft, with approximately $3.8 billion worth of assets stolen, according to blockchain analytics company Chainalysis. This represents the most significant one-year loss in the history of cryptocurrencies. State-backed North Korean hackers are believed to be the most active in this area.
The WEMIX team has stated that it is closely monitoring the situation and has requested that users refer to official announcements made by GDAC for detailed information and updates on the incident. GDAC has assured its users that all losses resulting from the hack will be fully compensated and has encouraged them to contact customer support for assistance.