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Lykke Exchange Suspends Withdrawals Following Security Breach

On Monday, June 10, the Swiss headquarters of the crypto exchange Lykke announced the indefinite suspension of withdrawal. The Lykke team confirmed that the withdrawal suspension was a corrective measure to address the June 8 malicious attack .

Lykke stated that bad actors launched a malicious attack on the crypto exchange aiming at stealing customers’ funds. Due to the damages caused by the exploit, the crypto exchange confirmed that the exploit affected the operation of Lykke UK and Lykke  Corp AG.

Hackers Gained Exploits Lykke Exchange

Even though the customers’ funds were safe and secure, the Lykke team was forced to take adequate preventive measures. The Lykke team updated the X community on the suspension of withdrawals. 

In response to the tweet, the renowned blockchain analytic firm SomaXBT stated that it discovered the exploit on June 9. SomaXBT blamed Lykke for failing to report the security breach immediately after the incident. 

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The security company claimed the criminals escaped with assets worth $19.5 million. The SomaXBT suspect that Lykke was concealing the information concerning the damages caused by the security breach. 

The  SomaXBT shared some screenshots concerning the attack, where Lykke claimed it was conducting complete system maintenance. On June 8, some Lykke users complained that they were unable to access the services offered by the crypto exchange. Other  X users suspected that the crypto exchange was compromised.

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Lykke Exchange Suffers $22M Exploit

After a days of downtime, the Lykke team confirmed that they had suffered an exploit. The crypto exchange apologized to the customers who were affected by the exploit. 

Lykke regretted having caused inconvenience to its key stakeholders, including customers. The crypto exchange vowed to use its capital reserves to compensate for the losses caused by the exploit. 

The Lykke claimed to have adequate capital reserves capable of compensating the customers affected by the exploit. According to the report, the Lykke team has commenced investigating to identify the culprit and recover the stolen funds. 

With ongoing investigation, Lykke claims to have identified an IP address belonging to the attacker. The crypto exchange intends to use the IP address in the ongoing criminal investigation to bring the bad actor to justice. 

Criminals Target to Steal for Centralized Exchanges

In the meantime, Lykke has hired cybersecurity experts to help trace the stolen funds. The probing team estimates that nearly $22 million worth of crypto assets were lost during the exploit.

A statement from the chief executive of Lykke, Richard Olsen, demonstrated that customers’ funds remain safe even after the incident. The CEO confirmed that the investigation was still ongoing.

The crypto exchange has operated for nearly a decade, transitioning from a forex broker to a fast-paced trading platform in Switzerland. Lykke claims to charge fees on its crypto exchange on the company website. 

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The security breach came at a time when centralized exchanges have become an easy target for hackers. Last month, ZachXBT stated that the Bahrain-based trading platform Rain Exchange lost nearly $14 million worth of crypto in a security breach. 

The Rain exploit came the day after Gnus.AI lost $1.27 million worth of crypto assets after the criminals gained unauthorized access to its Discord. Subsequently, the Kaspersky team cautioned crypto firms that the North Korean hacking group Kimsuky was targeting to launch Durian malware on exchanges.


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Kimberly Crain

Kimberly Crain is a seasoned crypto trader and writer, offering valuable insights into the digital asset market. With expertise in trading strategies and a passion for blockchain technology, her concise and informative articles empower readers to navigate the evolving world of cryptocurrencies.

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