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Crypto.com pauses withdrawals after theft in several users' wallets

The cryptocurrency game isn't as simple as Matt Damon and Tom Brady thought it was, as their beloved Crypto.com platform appears to have been hacked.

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Money never sleeps, as the old saying on Wall Street goes, and that is very true of the cryptocurrency market. Just a few hours ago, Crypto.com paused withdrawals from their platform in response to a series of thefts from users' accounts. Can someone get Matt Damon on the phone?

Jeweler, entrepreneur, and noted cryptocurrency enthusiast Ben Baller claims that his account had 4.28 Ethereum (nearly $15,000) stolen this evening. Ben also points out that he had two-factor authentication enabled, so these thieving hackers had to have circumvented some of Crypto.com's security protocols. 

Cofounder of Dogecoin and all-around swell dude Billy Markus pointed out a strange pattern of transactions via etherscan. As for what is causing this, it remains to be seen, but are we surprised that a financial platform backed by jaboofers like Tom Brady and Matt Damon caked its pants? Do decentralized finance plaforms have some equivalent of FDIC or SIPC insurance? 

Apparently the clowns over at crypto.com spent too much money on their advertisements and not enough time on making sure their cutting edge financial platform was secure. 

This is a terrible day for clients of crypto.com, and we don't mean to make light of their financial pain, but events like this highlight how dangerous it can be to put all your eggs in one basket. The basket might have a hole in it the size of Matt Damon's big, dumb head. If you are one of the unlucky people to have been robbed this evening, please consider tweeting @cryptocomcs, as they appear to be replying to users.

This caps off a pretty crazy first few weeks in the crypto markets. Dogecoin jumped 10% on news that Tesla would be accepting the cryptocurrency on their merch store. It was a ray of hope for dogecoin holders as the coin has fallen nearly 80% from its all-time high last year.

The good old Staples Center in Los Angeles has been rebranded to Crypto.com Arena because this is the worst timeline.
The good old Staples Center in Los Angeles has been rebranded to crypto.com Arena because this is the worst timeline.

In case you were wondering, this is the same cryptocurrency company that bought the naming rights to the iconic Staples Center in downtown Los Angeles. 

What do you think of investing in cryptocurrency? Is it too illiquid and risky for your tastes or are you HODLing to the moon? Let us know in the Shacknews Chatty comments thread below.

Luminary

Asif Khan is the Luminary and majority shareholder of Shacknews. He began his career in video game journalism as a freelancer in 2001 for Tendobox.com. Asif is a CPA and was formerly an investment adviser representative. After much success in his own personal investments, he retired from his day job in financial services and is currently focused on new private investments. His favorite PC game of all time is Duke Nukem 3D, and he is an unapologetic fan of most things Nintendo. Asif first frequented the Shack when it was sCary's Shugashack to find all things Quake. When he is not immersed in investments or gaming he is a purveyor of fine electronic music. Asif also has an irrational love of Cleveland sports.

From The Chatty
  • reply
    January 17, 2022 12:20 AM

    Asif Khan posted a new article, Crypto.com pauses withdrawals after theft in several users' wallets

    • reply
      January 17, 2022 5:50 AM

      The constant and effective scamming that goes on in the crypto space is the main reason I'd never invest in it. Listening to podcasts which detail crypto heists is entertainment enough, and all I have to invest is a bit of my time.

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      January 17, 2022 6:12 AM

      Can't wait to see the security post-mortem on that! Does crypto.com require two-factor or is this a matter of faith that people are telling the truth? Me being in IT for so long, when something bad happens the users are always absolute angels who did everything right and will tell that to your face to avoid being embarrassed by what happened.

    • reply
      January 17, 2022 6:48 AM

      Fortune favors the bold.

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      January 17, 2022 6:54 AM

      Probably Matt Damon.

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      January 17, 2022 7:09 AM

      It’s interesting because crypto has zero chance of doing its originally stated goal - to be an alternative or replacement currency - but as a “toy economy” type of thing (so, something not really used as an economy but simulates aspects of it, like company scrip or something) it definitely has and continues to experience all the scams that come with regular economies.

      Like it’s natural that when you have a system people will try and game that system, so when you have any system involving money (and in this case “involving money” meaning “crypto fake money can be turned into real money”) people will try and scam that system.

      The next thing that will happen (probably already has) is people will start demanding that these companies like crypto.com be able to insure their crypto fake money. Like maybe the government can help. And then you learn the hard way why yes, when the government backs money - the thing you were trying to avoid in the first place - you get things like FDIC insured banks.

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      January 17, 2022 7:21 AM

      I guess I thought this couldn't be stolen? Like if I had etheruim coins 107,108,109 how could they be stolen if I have them? When those coins got "sold" again wouldn't it flag the thief and not me?

      • reply
        January 17, 2022 7:45 AM

        They can be and are in fact stolen all the time. With crypto possession is basically all that matters; if a thief has them then they have them.

      • reply
        January 17, 2022 10:45 AM

        You have them in a wallet held by you with the exchange, someone gwts into the account and can initiate a transfer out of your wallet from in the account, to any other address

      • reply
        January 17, 2022 10:48 AM

        Yeah I thought the same. Thought Blockchain was supposed to be more secure? I just don't get it

        • reply
          January 17, 2022 11:41 AM

          Like aren't nfts whole thing that person X has the token to the actual thing? But I guess coins doesn't have that? What a pile of shit

        • reply
          January 17, 2022 2:49 PM

          Sure, the transfer from victim's wallet to thief's wallet was secure.

      • reply
        January 17, 2022 2:48 PM

        Just because it is traceable doesn't mean it can't get stolen.

      • reply
        January 17, 2022 4:20 PM

        Crypto.com is a centralized exchange. Decentralized exchanges are coming but, until then, trading crypto has no benefits to a regular stock market. It also has the same flaws.

        • reply
          January 17, 2022 5:21 PM

          and even then, it will have no benefits to a regular stock market

          unless you are a thief

    • reply
      January 17, 2022 10:02 AM

      Lol these crypto brokers are all trash. But hey, banks are evil, let's trust the shit that a bunch of tech bros hacked togerher!!

    • reply
      January 17, 2022 10:05 AM

      crypto: reinventing every financial fraud since 1637, one by one

    • reply
      January 17, 2022 10:18 AM

      People who leave their crypto online in an exchange's wallet are dumber than average.

      • reply
        January 17, 2022 10:28 AM

        ^^^^ this

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        January 17, 2022 10:31 AM

        I obviously still don't understand crypto. How does an offline wallet work that would prevent this?

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          January 17, 2022 10:41 AM

          For starters it's offline, so nobody is trying to break into it. Also wallets have private keys and most exchanges hold your private key rather than giving it to you.

          You can keep your own digital wallet and private keys, or you can use a hard wallert (encrypted electronic device not connected to the internet) or you can keep your crypto in a paper wallet (by writing down or printing the relevant info [wallet address, password, recovery phrase, private key]).

          It's not hard to understand an online computer phone wallet is infinitely more likely to be compromised than an offline computer phone wallet. Online is potentially vulnerable to billions of people, offline only vulnerable to people with direct physical access to it.

          • reply
            January 17, 2022 10:42 AM

            So to my question above about stealing is the key not tied to the coins?

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              January 17, 2022 10:46 AM

              The key is tied to the wallet, not the coins. So if someone steals or has access to your debit card (wallet) and knows your PIN (key) they can drain your account. The bank can tell you where the money was withdrawn (ATM in Nigeria for example), but they aren't going to tell you the serial numbers of the currency withdrawn. Crypto coins are individually identifiable afaik.

              • reply
                January 17, 2022 10:48 AM

                *crypto coins aren't individually identifiable afaik

          • reply
            January 17, 2022 10:45 AM

            No one is trying to break it...unless they literally just break in. If you're holding a large amount of value physically I hope your security is good.

          • reply
            January 17, 2022 10:47 AM

            Ah, so because the private key literally resides local on your machine and you can cold store that. Got it.

          • reply
            January 17, 2022 10:51 AM

            I get this but it also makes Cypriot even worse than regular banks. I don’t do this with my regular money.

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            January 17, 2022 11:03 AM

            Now explain why people use banks instead of storing their life savings in cash in their bedroom

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              January 17, 2022 12:03 PM

              Because banks are federally insured.

              • reply
                January 17, 2022 12:08 PM

                Pretty sure people used banks prior to the 1930s

                • reply
                  January 17, 2022 12:13 PM

                  The year is 2022 though.

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                  January 17, 2022 3:43 PM

                  You can get your cash stolen from you. Harder to steal from you if it's in a bank. At least that's what I think prior to 1930.

                  There's probably other reasons too. Some business refuse to deal in cash because it's basically undocumented funds so it's vulnerable to certain types of fraud.

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                January 17, 2022 12:24 PM

                That is just one protection among many that makes them the better choice.

          • reply
            January 17, 2022 12:30 PM

            [deleted]

          • reply
            January 17, 2022 3:44 PM

            Yea man sapfwz5 place on earth is a landfill https://www.cbsnews.com/amp/news/hard-drive-lost-bitcoin-landfill/

          • reply
            September 15, 2022 6:18 AM

            So I have to write down the 1s and 0s on paper and fold it and keep in my physical wallet?

        • reply
          January 17, 2022 10:43 AM

          Means only you have the keys to transact/hold the crpyto so can theoretically secure it better.

          Basically to get into the exchange just takes a standard financial services type of access's, e.g. username/password and some mfa so prone to things like sim card swaps, then they can transfer your assets out.

          If you have it yourself, someone has to go after you which is a lot less likely

    • reply
      January 17, 2022 10:42 AM

      Scammers hate financial regulation.

    • reply
      January 17, 2022 12:49 PM

      BTC up 4400% over the last 5 years… I’ll take my chances. Keep your stuff offline.

      • reply
        January 17, 2022 1:24 PM

        Yeah but I can't buy a video card for a reasonable price. Fuck BTC.

        • reply
          January 17, 2022 2:11 PM

          I mean maybe Crypto in general isn't at fault for this but I want to angry at something for video cards prices being so high.

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            January 17, 2022 2:16 PM

            Bro how is Crypto not a direct result of video cards prices being so high? I guess you could argue a lot of people are working from home and it's COVID fault but that is one video card per house hold or two not full warehouses and garages full of them.

            Crypto and all the other stuff under that umbrella are 100% the cause. That is My take.

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              January 17, 2022 2:18 PM

              One take I've heard is that video card prices is high is a function of how many wanting a video card at once. When the pandemic hit, so many people needed a PC or a laptop so prices went up.

              I think Crypto is at least partially at fault not 100%. But I'm still angry at prices being high.

              The real solution is to make so many cards that crypto becomes worthless. I dunno.

              • reply
                January 17, 2022 3:04 PM

                Crypto is at fault here, but we have to remember that it's not the only reason at fault. Remember that before the pandemic, video card prices shot up as Bitcoin neared 20k, but the prices went back to normal as Bitcoin prices dropped down to 3-6k. What we are seeing here is that prices for video cards shot up as Bitcoin neared 60k, but prices for video cards hasn't gone down even after Bitcoin loss almost 15k in the past few weeks because of demand/chip shortage.

                It's been consistent in the past. Video card prices rise and fall as Bitcoin prices rise and fall.

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                  January 17, 2022 3:25 PM

                  Bitcoin didn't near 20k before the pandemic. It hit around 7.5, in December 2019 and dropped to 5.5k in March, 2020. It didn't hit 20k till December 2020. It was under 11k when the $1500 3090 was released.

                  And you don't mine BTC with a GPU. You mine ETH. Even at MSRP a 3090 would have to run 24 hours a day for 300 days to pay for itself, and another week or two at least to pay for energy. ETH prices have fallen since the RTX's were released, and RTX prices have risen.

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                    January 17, 2022 3:28 PM

                    Also WTF $1500 video cards. That's on Nvidia.

                  • reply
                    January 17, 2022 3:37 PM

                    saying it didnt hit 20k is so pedantic lol, it was like 19650 in 2018

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                      January 17, 2022 4:16 PM

                      It never hit 20k until 12/20, a year after the pandemic began. That was an all time high (it got close to 20k in 12/17, two years before the pandemic began)

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                        January 17, 2022 4:22 PM

                        That's what he said.

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                          January 17, 2022 4:26 PM

                          No, he said it was almost 20k in 2018. That's true but it's also true that RTX 30x0's weren't released for two more years after that and it's true that BTC was around 6k when the pandemic began.

                          • reply
                            January 17, 2022 4:27 PM

                            er... that's not true. BTC wasn't near 20k in 2018. It was 4 to 13k.

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                        January 17, 2022 4:23 PM

                        Also in an effort to be pendantically efficient, at no time in 2018 was BTC 19650. It started the year around 13,500 and ended at 4,100.

                  • reply
                    January 17, 2022 3:51 PM

                    Of course you don't mine btc with you, but other coins that do, generally follow btc. When btc drops, growth of other coins generally slow to a crawl or drop also.

            • reply
              January 17, 2022 2:46 PM

              [deleted]

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                January 17, 2022 3:06 PM

                Yeah, this is probably the truth. It's more complicated than just bitocoin mining.

                The solution is to increase manufacturing capacity.

              • reply
                January 17, 2022 3:44 PM

                GPU shipments are way up. Sony has sold more PS5s than it’s previous consoles. It’s all demand driven.

            • reply
              January 17, 2022 3:30 PM

              Crypto didn't make nvidia price their cards at $800 msrp though lol

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            January 17, 2022 2:49 PM

            yeah well you can get mad or you can get even. since the start of the pandemic BTC/USD has increased by a higher percentage than even GPU prices have. in other words the price of a GPU in BTC is down. maybe holding onto your rapidly inflating USD is what you should be mad about. just food for thought

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              January 17, 2022 3:07 PM

              Yer mum got mad last night.

            • reply
              January 17, 2022 3:47 PM

              Counterpoint crypto crashes through the floor because it's a fucking scam. Hope you cash out in time.

              • reply
                January 17, 2022 3:54 PM

                There is a shit load of 'real' money in crypto, not just from speculation on currencies but from VC putting money into web3 and blockchain. It's a massive economy at this point. The currencies will fluctuate and there will be winners and losers in the race to web3 standardisations, platforms and tech, but 'crypto' which is a huge umbrella of technologies at this point is here to stay.

              • reply
                January 17, 2022 4:06 PM

                USD crashes first

                • reply
                  January 17, 2022 5:23 PM

                  what military backs bitcoin? would love to read up on it

                  • reply
                    January 17, 2022 5:27 PM

                    ok start by reading up on every other fiat currency in history. guess their armies weren't big enough or something?

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                      January 17, 2022 5:31 PM

                      your understanding of why fiat has value is flawed. governments are what give currencies value.

                      if the usd has issues, it's because the us has issues (a reasonable argument). fiat will always be king, for better or worse.

                      crypto is a speculative asset largely successful due to technologically illiterate people with FOMO and actors who want a way to launder currency or evade taxes.

                      glad you won something in the lotto. count your blessings, if you think that shit is a long-term hold there will ultimately be a reckoning. and it will be long before a fiat currency has problems.

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                        January 17, 2022 5:34 PM

                        okay

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                        January 17, 2022 5:49 PM

                        exchange the word 'crypto' in your post with the word 'cash'

                        same thing.

                        "cash is a speculative asset largely successful due to technologically illiterate people with FOMO and actors who want a way to launder currency or evade taxes"

      • reply
        January 17, 2022 3:55 PM

        Brought to you by the 0.5% of all energy usage in the world.

    • reply
      January 17, 2022 3:02 PM

      Convert the bulk of your holding to Monero and store on a hardware wallet under your mattress.

    • reply
      January 17, 2022 6:01 PM

      Obviously the people affected by this theft were cowards since fortune favors the brave.

    • reply
      January 17, 2022 7:04 PM

      voice on phone: "He's calling from inside the building!"

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