BitcoinCryptocurrencyExchanges

Hox Syndrome: Livecoin Closed When BTC Price Above $ 320,000

The end of the year turned out to be unfortunate for Russian-speaking cryptocurrency exchanges. Exmo was hacked on December 21st, and Livecoin stopped working on December 25th, explaining this by a “carefully planned hacker attack.”

Livecoin reports on its website that the attack took place on the night of December 23-24, after which the exchange lost control of all its servers and infrastructure. The exchange urges clients to stop all operations with the platform, however, asset withdrawal and trading are already closed. The exchange’s information channels were also compromised. 

Livecoin specialists posted a warning to users on the main page of the exchange website, as employees could still control the web interface. Livecoin said it is working hard to regain control of its servers. The management of the exchange promised to provide a security update in the coming days and announced the involvement of law enforcement agencies.

According to the exchange, the hackers “managed to take over the infrastructure of Livecoin and change the prices on the exchange to abnormally high values.” The creator of the YellowBlock cryptocurrency portal, known under the pseudonym “Cryptorangutang”, tweeted that the latest bitcoin rate on the exchange exceeded $ 320,000. However, most likely, the prices were “lifted” by traders themselves, trying to escape from the sinking ship, despite the losses.

At the time of publication, the Livecoin site remains inoperable, only a warning about hacking is displayed on it. Later it turned out that Livecoin employees stopped communicating on all channels. Livecoin trading volumes are no longer available on CoinGecko and CoinMarketCap aggregators. All this allows us to assume that behind the “hacker attack” is the disappearance of the exchange owners with the remaining users’ money.

Livecoin was launched in April 2015 and developed rapidly in the early years, but subsequently began to lose ground. As of December 24, 2020, the platform ranked only 173rd in the ranking of cryptocurrency exchanges, and its daily trading volume was about $ 16 million.

This week the Russian-language exchange EXMO also suffered from a hacker attack  . The cybercriminals stole over $ 10.5 million worth of BTC, ETH, USDT, XRP, BCH and ZEC. However, the exchange promises to reopen all transactions in the coming days and reimburse users for losses.

The story with Livecoin is a lot like the collapse of MtGox, Cryptsy, Cryptopia, WEX, QuadrigaCX and other failed exchanges. At first it all started out with rumors, then there were difficulties with the conclusion. And finally, the moment of truth came in the form of a complete closure of the exchange, usually with reference to an attack by hackers or other external factors. But in most cases, the reason for the ruin of cryptocurrency exchanges is the incompetence or outright fraud of their founders. 

It is likely that the same fate befell Livecoin. A “hole” in the exchange’s budget could have appeared several months ago, when the first complaints from users began to appear. And the sharp rise in cryptocurrency rates only accelerated the denouement, since it is much more difficult to close the shortage in a constantly rising asset than in a stable or falling one.

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