Crypto exchange Bitmart has reportedly lost nearly $200 million in a hot wallet compromise hosted over the Ethereum and Binance Smart Chain blockchains, revealed by Peckshield, a blockchain security and data analytics company that initially identified a transfer of roughly $100 million over the Ethereum blockchain.
Paul Bischoff, privacy advocate with Comparitech, commented:
"Cryptocurrencies rely on blockchain technology to verify transfers and secure transaction records. Although blockchains are reasonably secure and reliable, the same isn't always true for the exchanges where people buy, sell, and trade crypto. Exchanges, even though they function like banks, are not insured (e.g. by the FDIC). If the exchange loses assets that belong to its customers via an external hack or inside job, customers might have no recourse to recover their funds. It's difficult for customers to know which exchanges have sufficient security and make an informed choice. An exchange that operates 10 years without a security incident can still be crippled and put out of business by a single large-scale heist."