The rumours surrounding CoinBene’s potential hacking came about after users noticed delays while withdrawing or depositing funds and services were down. CoinBene explained on twitter that they had put wallets under maintenance in order to upgrade the platform after one user asked whether they’d been hacked after waiting for a deposit confirmation for more than an hour.
“In order to enhance the user experience, CoinBene upgraded the platform wallet on March 26, 2019. During maintenance, it will affect related operations such as deposit and withdraw, trading will not be affected.” explained the exchange.
Sequence Of Events Point To Hacking
However, Max Galka, a data scientist and CEO of the blockchain infrastructure company Elementus, has questioned this, saying that the sequence of events is consistent with a hack. In an article he says it begins with $105 million in crypto leaving CoinBene and being sold on various exchanges.
“Transfers of this size are not unheard of when an exchange is moving funds between hot and cold wallets, but that is clearly not what’s happening here,” he writes. “After leaving CoinBene, the tokens were quickly moved into Etherdelta, where they were sold for ETH. A large amount of funds were also moved into centralized Exchanges, including Binance, Huobi and Bittrex”.
At the time of writing, funds are still being moved.
The sequence of events, large amount of funds withdrawn quickly, a period of inactivity, remaining funds secured into the cold wallet is consistent with how exchange hacks commonly play out, says Galka.
Moving funds through sweeping addresses is not commonly done by exchanges, and the “pattern of transfers between multiple intermediary wallets is not commonly seen among exchanges. It is, however, a common tactic for people who want to cover their tracks, moving the crypto through a series of “sweeping addresses” to make the trail more difficult to follow”.
CoinBene Claims Preventative Measures
In a statement on twitter, CoinBene said that they had received news from other unnamed crypto exchanges that user assets had been stolen and they wanted to take swift action to protect and upgrade wallet security to protect their users. They added that “assets on the CoinBene platform are 100% secure,” and promised that they will fully compensate any users who may lose any funds in the future.
They also said that their security team monitors any anomalies and that they would “issue a warning the first time to prevent any possible risks”.