Cryptocurrencies were once seen as a game-changing innovation that would make financial transactions more secure and fraud-proof. However, with the occurrence of various high-profile hacks and scandals, people’s faith in the safety of cryptocurrencies has dwindled. One of the most infamous cases of cryptocurrency hacking is the MtGox hack, which resulted in the breach of the largest Bitcoin exchange in the world.
MtGox was started by Jed McCaleb in 2010 as a website for trading Magic the Gathering cards, but he soon saw the potential of Bitcoin. A French software programmer named Mark Karpeles assumed control of the exchange in March 2011 and turned it into a Bitcoin trading hub. MtGox expanded quickly under Karpeles’ direction, handling more than 80% of all Bitcoin transactions at its height and processing over $100 million in transactions per month. However, MtGox unexpectedly stopped all trading in February 2014 due to a fault that allowed for price manipulation of Bitcoin on its site by hackers.
Hackers had stolen 850,000 Bitcoins worth about $450 million at the time from the exchange. After the hack, MtGox filed for bankruptcy, and the company was forced to shut down. Although several attempts were made to recover the stolen funds, a significant amount of the Bitcoins remain missing to this day. While authorities conducted an investigation into the incident, the identity of the hackers and the exact details of the hack are still unknown.
The MtGox hack’s aftermath resulted in the company’s bankruptcy and a subsequent decrease in Bitcoin’s value, leading many investors to lose faith in the cryptocurrency industry
To read more about this infamous hack and the ongoing repayment process for creditors, visit the official website Coinpedia.
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