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Binance Freezes $5.3M in Stolen Funds After Cyber Attack on Turkish Crypto Exchange Btcturk

Last Updated June 24, 2024 10:15 AM
Teuta Franjkovic
Last Updated June 24, 2024 10:15 AM

Key Takeaways

  • Turkish crypto exchange Btcturk suffered a cyberattack that resulted in unauthorized withdrawals from hot wallets.
  • Binance is aiding Btcturk in investigating the incident and has recovered $5.3 million in stolen funds so far.
  • Btcturk has resumed deposits and withdrawals for ERC20 tokens and assured users that most assets remain secure.

The Turkish cryptocurrency exchange Btcturk has experienced a cybersecurity breach  that enabled unauthorized withdrawals.

In response, Binance has stepped in to help investigate the incident and has successfully frozen more than $5.3 million in funds that were illicitly taken, according to Binance’s CEO.

Following these developments, Btcturk has resumed allowing deposits and withdrawals for all ERC20 cryptocurrencies on its platform.

Btcturk Hit by Cyber Attack, Binance Assists in Investigation

On Saturday, the Turkish cryptocurrency exchange Btcturk announced  it had been the target of a cyber attack, which compromised the security of its hot wallets. As a precaution, the exchange temporarily suspended all cryptocurrency deposits and withdrawals. Btcturk is currently working closely with Binance to investigate the breach and understand the extent of the incident.

According to  Btcturk:

“Our teams detected a cyber attack on June 22, 2024, causing unauthorized withdrawals from our platform. Only portions of the balances of 10 cryptocurrencies in hot wallets were affected, while most assets stored in cold wallets remain secure.”

Btcturk assured users that its financial reserves greatly exceed the impacted amounts, guaranteeing the safety of user assets. The exchange also mentioned that detailed investigations are in progress and that they have reached out to official authorities. As a safeguard, cryptocurrency deposits and withdrawals will remain suspended until their investigations are concluded. The exchange plans to gradually restore affected cryptocurrency operations as its cybersecurity teams complete their assessments.

Btcturk Reopens ERC20 Deposits and Withdrawals, Binance Recovers $5.3M in Stolen Funds

In a status update on Sunday, Btcturk announced that it has reopened deposits and withdrawals for all ERC20 cryptocurrencies on the ERC20 network. Meanwhile, Binance CEO Richard Teng made an announcement on the social media platform X on Saturday saying Binance is helping Btcturk with the investigation of the cyber attack and has successfully frozen more than $5.3 million in stolen funds so far.

ZachXBT, a prominent Bitcoin analyst, suggested  in a post on the social media platform X that a specific address, which he has been monitoring, could be responsible for recent suspicious activities. According to him, this address has transferred 1.96 million AVAX, valued at approximately $54.2 million, to Coinbase and THORChain. He also shared the cryptocurrency address in his post.

In Turkey, cryptocurrencies have become immensely popular, making the country the fourth-largest crypto trading market globally. The surge in cryptocurrency usage in Turkey began in earnest after 2020, largely as a response to the significant depreciation of the Turkish lira.

Thodex Founder Receives Record-Breaking 11,196-Year Sentence

This is not the first time Turkish crypto exchanges have experienced a downfall. Faruk Fatih Ozer, the founder of Thodex, a major Turkish cryptocurrency exchange, was sentenced last year for a staggering 11,196 years. This sentence was handed down after he was found guilty of orchestrating an exit scam that defrauded investors of millions of dollars.

Özer used Thodex, with assistance from his family, to defraud his customers of massive sums. Both his brother and sister received identical sentences of 11,196 years. The judge remarked that this sentence length was more than what 50 humans could physically serve, marking it as the longest ever issued by a Turkish court.

During his last days of freedom, Faruk Fatih Özer grew his beard long, down to his chest, and traveled to southern Albania with a tent, planning to camp along the coastline. However, law enforcement caught up with him while he was at a social gathering.

By that time, Özer claimed that he no longer had the hardware wallet reportedly containing $2 billion. He asserted that he had emptied the wallet, using the funds to repay his victims, and had disposed of the wallet by throwing it into the Ionian Sea.

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