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Japanese Cypto-Exchange “Liquid” Loses $94 Million to Cyber Theft

Japanese cryptocurrency exchange Liquid announced it fell victim to an attack that resulted in large amounts of crypto-currency assets being stolen.

Liquid announced that hackers were able to compromise its warm wallets, stealing various amounts of Ethereum, Bitcoin, Stablecoins, Ripple, and other tokens.

Liquid, like most of the cryptocurrency sector, is not sufficiently secure enough for financial transactions.

“We are sorry to announce that #LiquidGlobal warm wallets were compromised, we are moving assets into the cold wallet. We are currently investigating and will provide regular updates. In the meantime deposits and withdrawals will be suspended,” Liquid said in a statement.

Warm wallets are usually online and are used for easily accessing and trading funds. Cold wallets, on the other hand, are stored offline and are considered more secure.

The exchange platform says that fiat withdrawals and deposits were not impacted and that other services such as trading and Liquid Earn remain available as well. Liquid says it wasn’t yet able to identify the attack vector used.

The crypto-currency exchange is urging users not to deposit crypto-currency assets in their Liquid wallets until the attack is fully mitigated.

London-based blockchain analytics firm Elliptic said the hackers were able to hijack more than USD $94 million in various crypto-currencies.

“This includes $45 million in Ethereum tokens, which are currently being converted into Ether using decentralised exchanges (DEXs) such as Uniswap and SushiSwap. This enables the hacker to avoid having these assets frozen – as is possible with many Ethereum tokens,” according to a note from Elliptic.

Cryptocurrency security is a specialty of ours at BLAKFX. Our data security company set out to be the world’s most secure cryptocurrency and we decided to take it to the next level and protect all data, not just crypto.

Bitcoin price is back over $50,000.

Unfortunately, the only thing holding cryptocurrency acceptance back is the lack of data, wallet and exchange security. Everyday we hear about currency thefts, exchange hacks and currency thefts. The entire sector has to take the issue much more fanatically.

The real problem is that most crypto tools don’t use very sophisticated anti-hacking systems. The most common feature is two-factor authentication: for each transaction you need to enter a one-time password, which is sent to the client’s phone or e-mail.

With this in mind, 2FA is not the most secure way of protection. A more advanced option for two factor authentication is special applications like Authy and Google Authenticator. They block access to the system if the login and password are compromised by asking for additional code.

The second most popular method of protection is multi-signature: when several keys to Bitcoin wallet are kept by different owners, and access to the funds can be obtained only by collecting all electronic signatures. However, this system can also fail. Experts note that multisignature works only when all key owners are independent from each other.

One of the most reliable ways of protection against hacker attacks remains distribution of funds between hot and cold wallets. In addition to physical protection (video cameras, armed guards, retinal scanner, etc.), a cold wallet can be equipped with a multi-signature system. The bigger the share in the cold storage, the safer it is. Ideally, cryptocurrency should only get online at the time of the transaction.

Another way are the so-called Bitcoin “valves,” special Bitcoin addresses, where coins are locked by a two-stage security mechanism with two different keys. To unlock funds, you need a regular digital key, but full access to the money is only possible after 24 hours. Within those 24 hours, any transaction can be cancelled by entering the second key. There is another degree of protection: if a hacker has both keys, the exchange can burn the funds stored in the wallet.

Regular audits by independent experts and hacking tests have become a good tone among crypto exchange operators. The latter is done by so-called white hackers. Their goal is to hack into security systems to find potential vulnerabilities that can be exploited by attackers.

One way or another, a complex approach is important in the question of cryptocurrency exchanges security: security of code in combination with security of development environment and third-party libraries used in the product creation. It is also impossible to exclude human factor, which often contributes to hacker attacks.

Unfortunately, very few methods are working.

The problem with all these security protocols, is that once they are defeated and breached, the funds are in the clear and easily stolen.

The founders at BLAKFX, as mentioned earlier, originated their current data security product (Helix22) as a cyber currency, exchange, wallet and blockchain. Therefore our data security product, the Helix22 SDK, is fully designed and functioning to facilitate the cyber currency sector.

              Our Motto

       In Math We Trust

What we understand better than anyone else is the new era of data security is one that requires new solutions. The era of perimeter defenses is over as it is proving impossible to keep hackers from breaching the perimeter and accessing data. Further E2E encryption based on old models of RSA cryptography will be obsolete when quantum computing becomes mainstream.

Helix22 is Designed To Be Quantum Immune – Start Your Integration on our Git

Helix22 delivers perfect security assurance due to our genius engineering team that has invented a new model for data security that required an innovative look at the problem. The approach we took was to protect the data itself. Almost all other data security products try to build a perimeter or being fanatic on user credentials. However, once the product is breached or a password is stolen, even if it is 2FA or encrypted, your firms data is in the clear.

You see, the Helix22 cryptography is embedded with the data itself through our inventive and patented cryptography of DNA BindingTM. Therefore, even if credentials are stolen the data cannot be exfiltrated. This means that all data is 100% protected regardless of the type of attack.

Another substantial advantage of Helix22, is that it protects all data whether at rest, in use or in transit. All communication apps for example, only encrypt data while in transit. Therefore, that encryption become useless for internal IT security or Artificial Intelligence or Machine Learning experimentation. All data generated during these massive computing exercises is equally protected in real time. Plus, the latency period for the Helix22 is exponentially less than any other security product, so it actually contributes to faster processing times.

The Helix22 is easy to install and runs on all platforms, programming languages, networks and devices.

              Our Motto

      “In Math We Trust”

In this protocol, we are truly a “zero-knowledge” server so your private communications and transmissions remain completely top secret. Even in the event that BLAKFX were subpoenaed, we can honor the request by just handing over the encrypted content…as that is literally all we have. Helix22 also only use keys just one-time and then destroys them. This way the data security is future forward prefect. Therefore, in our unique user-to-user encryption (U2U) world, there is no opportunity ever for any data leak.

The Helix22 data security SDK accomplishes the following:

  • Protects all your firms data at rest, in use and in transit
  • Renders ransomware threats obsolete
  • Eliminates human error
  • Eliminates all malicious or interior attacks
  • Verifies original content i.e. minimizes the threat of impersonation attacks and deep fakes
  • Reduces latency
  • Installs with 5 lines of code
  • Runs on any platform, network, device and in any programming language
  • Protects all data equally as well on the cloud and at the edge
  • Provides perfect future/forward secrecy
  • Delivers “zero-knowledge” encryption
  • Compatible with all cloud, 3rd party and vendor services
  • Is quantum ready – so there’s no need to upgrade when the time comes
  • Requires no employee training
  • Exceeds all gov’t and banking standards
  • Meets all international compliance regulations

D2D encryption

We can make this claim as the tech engineers at BLAKFX invented and patented a genuine device2device (D2D) encryption. We manage data security transmission through the truly brilliant and also patented universal Helix22 key service. The Helix22 encryption originates on your network or device, not just when the app is opened. This means, that when data arrives to our key server, it is already encrypted so all it needs to do is issue another key. Signal and Telegram cannot claim this level of security. This key will then only work with the intended device, which generates a matching key required to open the data. In this protocol, we are truly a “zero-knowledge” server so your communications and transmissions remain completely top secret. Even in the event that BLAKFX were subpoenaed, we can honor the request by just handing over the encrypted content…as that is literally all we have. Helix22 also only use keys just one-time and then destroys them. This way the data security is future forward prefect. Therefore, in our unique device-to-device encryption (D2D) world, there is no opportunity at all for any data leak.

This same protocol just described, can be the same with all your 3rd party vendors and suppliers. It does not matter in the least what platform they are running or what device they are using or even the type of data, it is all 100% protected. We do however, strongly advise that all firms involved be utilizing Helix22 due to the nature of the data content. Helix22 can ensure that whatever data they are generating is protected as well.

Let’s take it a step further. Even if your organization were a victim of an internal attack or a victim of malicious open source downloads, there is no reason for concern. Any data that has been forwarded, downloaded, copied or saved cannot be exfiltrated. Period.  We have the technology industries foremost data packets which are protected with multi-layered, military grade encryption algorithms that have already proven the ability to withstand penetration testing from MI5 and quantum computing attacks.

One final practical genius of DNA BindingTM is in that it is immediately compatible with whichever system or software you are utilizing. Therefore, any organization can forward information to another and then discuss it and there is immediate privacy.

BLAKFX is Based on Success

Our founders, Robert Statica PhD and Kara Coppa, also founded Wickr, which is used by the US military and has never been hacked since its inception in 2012. The Helix22 data security SDK is several generations enhanced since then. Dr. Statica also delivered the encryption for the world’s most secure phone, Katim.

                                         

Founder – Robert Statica PhD            Founder – Kara Coppa                   Founder – Alex Maslov MS, MBA                    

 

                               

Co-Founders of Wickr                    KatimTM Ultra Secure Smartphone

 

Finally, the Helix22 encryption is quantum computing ready so no need to redo all your data security methodologies in a couple of years when everything else becomes obsolete.

We like to refer to Helix22 as “22nd Century Data Security.”

The wrold's foremost B2B and B2G data security product.

Helix22 – Zero Risk