Will Traders Get Their Funds Back?
Cryptopia, a popular New Zealand based exchange suffered one of the worst hacks known to the crypto community in 2019. Hackers managed to steal the equivalent of $16 M USD. The exchange continued to operate for a few more months until it shocked traders with a surprise announcement. In the announcement, Cryptopia declared that it is going through liquidation. Traders who stored their funds on the exchange haven't had any access to their funds for months.
The only other scandal to surpass it in the world cryptocurrencies in 2019 would be the Chinese wallet, PlusToken.
Light at the End of the Tunnel?
The exchange has posted periodic updates via their appointed liquidator, Grant Thornton, a global advisory & accounting firm. These updates are available via Twitter.
Per the update, it appears that Cryptopia's data was stored by a 3rd party in the United States. Grant Thornton is working along with police and government agencies to return funds to users. It does seem that they are struggling, however. They have noted their struggle to determine individual customer holdings.
Other points of interest include their attempt to recover funds from the January hack. They finished the announcement by reminding their clients that they will likely need to go through another KYC/AML process. This will be needed if and when client funds will be returned.
As with the infamous Mt. Gox hack and closure, retrieving funds could possibly take years, if at all. While keeping the community informed is a step in the right direction, one should see this announcement as a bit over optimistic.
Remember the common saying "not your keys, not your Bitcoin" and store your cryptocurrencies securely.
Written by Jonathan Ganor
Writer & cryptocurrency aficionado