NiceHash bitcoin heist sees theft of more than $70m

8 Dec 2017

Image: Yuri Shebalius/Shutterstock

While the bitcoin market balloons, NiceHash is still dealing with the fallout of a heist that saw hackers swipe a massive sum.

NiceHash, a Slovenian bitcoin-mining exchange founded in 2014, earlier this week fell victim to a major hacking incident, which saw thieves get away with approximately 4,700 bitcoin. The theft comes as bitcoin valuations continue to rise in what is becoming a volatile market.

According to CoinDesk, the hack, which took place on Wednesday (6 December), resulted in the loss of bitcoin with a cash value of more than $70m, at the time of writing. News of the hack came as the NiceHash website experienced a long period of downtime, with many people reporting that their wallets had been emptied.

CEO Marko Kobal explained the situation in a video statement with co-founder Saša Čoh yesterday, saying that the hackers were able to infiltrate the system due to a company computer being compromised. The IP address of the hackers is from outside of Europe, and it is not known whether it was the plan of an individual or a collective.

NiceHash describes itself as the largest marketplace for mining digital currencies, and said that attempts were currently being made to bring the site back online following the security breach, but it has not yet been restored.

According to Kobal, NiceHash has paid out more than $1bn since it was founded several years ago.

Trying to reassure customers

During the Facebook live stream, Kobal tried to reassure customers that the firm was doing all it could to solve the issue: “We have not abandoned you guys.”

He also said that “forensic analysis” is being carried out between local and international authorities, but did not specify any particular organisation when asked by the BBC.

Kobal said the success of the site and the ballooning bitcoin market meant that NiceHash “became a target and someone really wanted to bring us down”. Kobal declined to comment as to whether users would see their wallets restored.

Hackers targeting bitcoin exchanges is nothing new. In 2015, a European bitcoin exchange called Bitstamp fell victim to a similar incident when 19,000 bitcoins were stolen from website accounts, worth approximately $5.2m at the time. At this point, CNN had valued a single bitcoin at around $275.

Updated, 4.52pm, 8 December 2017: This article was updated to clarify the cash value of the bitcoin stolen from NiceHash.

Ellen Tannam was a journalist with Silicon Republic, covering all manner of business and tech subjects