Flexcoin folds after hacker steals all its online bitcoins

Comment on this story

Flexcoin, a Bitcoin bank based in Canada, was closing down after losing bitcoins worth about $600 000 (R6.5 million) to a hacker attack enabled by flaws in its software code, it said.

Flexcoin said in a message on its website that all 896 bitcoins stored online had been stolen on Sunday. Its collapse came after Mt Gox, once the dominant Bitcoin exchange, filed for bankruptcy protection in Japan and said it might have lost some 850 000 bitcoins due to hacking.

“As Flexcoin does not have the resources, assets, or otherwise to come back from this loss, we are closing our doors immediately,” the bank said.

It later posted an update on its site saying that the attack had exploited a flaw in its code on transfers between users and involved inundating the system with simultaneous requests to move coins between accounts.

“Flexcoin has made every attempt to keep our servers as secure as possible, including regular testing,” it said, adding it had repelled thousands of attacks over the past few years. “But in the end, this was simply not enough.”

The firm, which said it was working with law enforcement agencies to trace the source of the hack, said it would return bitcoins stored offline to users.

Flexcoin said on February 25 that it was not affected by Mt Gox’s closure. “While the Mt Gox closure is unfortunate, we at Flexcoin have not lost anything,” it had tweeted then. – Reuters


sign up
 
 

Comment Guidelines



  1. Please read our comment guidelines.
  2. Login and register, if you haven’ t already.
  3. Write your comment in the block below and click (Post As)
  4. Has a comment offended you? Hover your mouse over the comment and wait until a small triangle appears on the right-hand side. Click triangle () and select "Flag as inappropriate". Our moderators will take action if need be.