Crypto Exchange Bitget Pauses Withdrawals After $350 Million Stolen in Hack

Crypto exchange Bitget suspends withdrawals after $351.6 million digital assets are compromised due to security breach The company said it has conducted an emergency inspection and suspends all customer withdrawal on its platform.

Bitget's security measures identified a series of unauthorized transactions originating from a handful of the exchange's hot wallets at 18:31 UTC on Thursday, the company said. It has enabled its contingency plan by pausing withdrawals while it examines the incident.

The exchange said the hacks were limited to certain parts of its hot and warm wallet infrastructure, with its cold wallets unaffected. Bitget also said the amount of each customer's account is still accurate, deposits and trading are functioning as usual.

The company said the User Protection Fund -which has a balance of more than $464 million - will cover the entire loss. Bitget said the fund is there to guard customers from security breaches.

According to the assets stolen were - Ether, XRP, BNB, Avalanche and a handful of stablecoins. Blockchains data showed the stolen assets were first moved multiple times across different networks before being transferred and swapped across other addresses.

Gracy Chen, CEO of Bitget, said on Twitter that the company's preliminary investigation found that the attacker had compromised a backend system linked to the exchange's wallet system. This system was reportedly used to alter transaction data and initiate the message that authorized the movement of funds. How the attacker gained access to the system is still under investigation.

The attack has also been linked to hacking groups with ties to North Korea, Chen said, though the investigation is still in progress, and the malware involved in the breach has not been independently identified as being associated with those groups. Bitget has reported the attack to authorities and blockchain security companies.

The event occurred as crypto exchanges were still struggling to fend off hot wallets, backend and cross-chain attack vectors. Huge crypto thefts such as this one can also push exchanges to show they have enough customer assets protected and emergency reserves to cover the damage.

Bitget said it will enable withdrawals again once its security assessment clears normal operation. The exchange also promised a more detailed incident report that will explain the root of the problem and what it has done to fix it.

The breach highlights the ongoing security concerns in the cryptocurrency industry as major exchanges roll out new offerings and attract retail and institutional customers.