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BtcTurk Hack Triggers Avalanche’s AVAX Decline to 6-Month Low of Under $25

2 mins
Updated by Lynn Wang
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In Brief

  • BtcTurk, Turkey's prominent crypto exchange, suffered a cyber attack on June 22, compromising 10 of its hot wallets.
  • The incident coincided with a significant 10% drop in Avalanche tokens, with approximately $54.2 million in AVAX sold.
  • Despite the assurances that user assets remained safe, the breach highlights ongoing challenges within the industry.
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BtcTurk, Turkey’s leading crypto exchange, said a cyber attack on June 22 compromised 10 of its hot wallets.

However, specific details regarding the affected assets or the total amount stolen remain undisclosed.

BtcTurk Hack Leads to $54 Million Avalanche’s AVAX Sell-off

In a statement on its status page, BtcTurk assured users that the hack did not impact their crypto holdings and emphasized its financial resilience against such attacks. The exchange clarified that only a portion of the balances in the ten cryptocurrencies’ hot wallets were affected, while the majority of assets in cold storage remained secure.

“Only some of the balances in the hot wallets of 10 cryptocurrencies were affected by the cyber attack in question, and our cold wallets, where most of the assets are kept, are safe. BtcTurk’s financial strength is well above the amounts affected by this attack, and user assets will not be affected by these losses,” a translation of the exchange statement reads.

Meanwhile, the incident coincided with a notable 10% drop in Avalanche’s AVAX token. Blockchain analyst ZachXBT reported a significant transfer of approximately 1.96 million AVAX tokens, valued at $54.2 million, to various exchanges, including Coinbase, Binance, Gate, and through THORChain.

Read More: 11 Best Avalanche Wallets to Consider in 2024

His analysis further suggested the entity might have exchanged the AVAX tokens for Bitcoin. Due to this, AVAX’s price fell to a 6-month low of under $25 but has slightly recovered to $26 as of press time, according to BeInCrypto data.

AVAX Price Performance.
AVAX Price Performance. Source: TradingView

“I conducted a timing analysis and found highly probably BTC withdrawals made shortly after the AVAX deposits at both Coinbase and Binance,” ZachXBT stated.

Following the breach, BtcTurk temporarily halted crypto deposits and withdrawals on its platform. It added that it has initiated an investigation into the incident while urging users to remain patient.

Read more: 17 Best No KYC Crypto Exchanges: Top Choices in 2024

Community members have raised concerns about BtcTurk’s security measures in light of the attack. ZachXBT highlighted the limitations of Know Your Customer (KYC) and compliance regulations, suggesting that some exchanges, despite regulatory adherence, may overlook critical security threats.

“The harsh reality about KYC and compliance in general is that it’s quite ineffective for any actual threats (does not matter whether it’s regulated or offshore exchanges) It’s not really the exchanges fault they are just trying to meet laws/regulations. Main difference between exchanges are those who build teams which respond to ongoing threats and are receptive to feedback. Some of these ‘regulated’ exchanges are completely out of touch about actual issues,” he added.

This breach underscores the persistent vulnerabilities within the crypto sector, which have even affected major exchanges. This year alone, crypto-related hacks and thefts have resulted in losses exceeding $600 million, with around 50% of this attributed to the $305 million hack of DMM Bitcoin, a prominent Japanese exchange.

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Oluwapelumi Adejumo
Oluwapelumi believes Bitcoin and blockchain technology have the potential to change the world for the better. He is an avid reader and began writing about crypto in 2020.
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