Bitstamp Resumes Its Operations after Hacking Attempts

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Bitstamp Resumes Its Operations after Hacking Attempts
Bitstamp Resumes Its Operations after Hacking Attempts

Bitstamp Resumes Its Operations after Hacking Attempts

Bitstamp, the world’s largest Bitcoin exchange which faced a hacking attack that crippled various platforms for exchanging the digital currency and raised questions about the security of its global network, has announced that now customers can get Bitcoins without any hassle. Earlier ForexMinute had reported that automated customer withdrawals from the company were halted for four days.

There are also some reports that Silk Road 2.0 was hacked by attackers who made off with nearly $2.7million in Bitcoin. The company which claimed to be a reincarnation of Silk Road, the online black market that was dramatically shut down last year following a high-profile FBI sting in the U.S., lost its entire money.

A similar attempt was made on Bitstamp which has now restored its operations. Interestingly enough the administrator at Silk Road 2.0, Defcon said that it was infiltrated by hackers who exploited the same transaction malleability that caused temporary transfer shutdowns of the two Bitcoin exchanges BitStamp and Mt. Gox.

ForexMinute in earlier reports have already made it clear that Mt. Gox was the first Bitcoin exchange that faced the problem and it in fact had to halt its operations. Later on it resolved the problem but meanwhile another Bitcoin exchange Bitstamp faced similar problem and discontinued processing of Bitcoin for four days.

**relatedarticle**

Is It Trouble with Bitcoin or With the Bitcoin Exchange?

A whole new issue appeared when Mt. Gox blamed Bitcoin itself for the technical glitch it was facing; however, later on it was denied by the Bitcoin Foundation. A lot of people also accused Mt. Gox that it was not using the correct internal procedures to protect its accounts against anyone who might exploit transaction malleability.

A debate is going on whether it is an inherent problem with Bitcoin or a problem with the software at Bitcoin exchanges. For instance, Mt. Gox and Bitstamp according to some experts were under a DDos (Distributed denial-of-service) attack and there was no loss of Bitcoins. It is to be noted that similar DDos attacks recently closed down several sites like Yahoo, YouTube and others.

Therefore, it should not be associated with DDos attacks should not be associated with an inherent problem with Bitcoin. In DDoS attack a multitude of compromised systems attack a single target which generates problem wherein services are denied to users of the targeted system. Here the flood of incoming messages to the target system essentially forces it to shut down and a legitimate user is unable to access the services.

To contact the reporter of this story: Deepak Tiwari at deepak@forexminute.com