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Trade.io is based out of Switzerland, which has been an advocate for blockchain technology and even cryptocurrency through the years. Their main claim to consumers is that they’re the “next generation financial institution,” but it seems that their advancements aren’t what it is cracked up to be. Based on an annoucement from the firm, they are one of the most recent victims of a hack against their cryptocurrency.
The annoucement indicates that, only hours ago, there were 50 million Trade Tokens (TIO) involved in the theft, which is the cryptocurrency of the firm. The current price of tokens would make the value $7.5 million. However, when the hack took place, that amount was closer to $11 million instead.
Even though the hack is still being investigated, there are a few facts that the firm and the public should be aware of.
- 50 million TIO were transferred at 14:40 GMT from a cold storage wallet that is owned by Trade.io. This cold wallet was being kept in a security deposit box, and the funds inside were meant for the “liquidity pool” of the company.
- 1.3 million TIO were sent to Kucoin and Bancor. However, these transactions took place before Trade.io has sent work to freeze any TIO transactions going in or out of their exchange.
- Since the hacking was exposed, Kucoin and Trade.io have temporarily suspended trading involved with TIO. Bancor, however, has permanently banned the token from their exchange.
- The decision is in the air right now, regarding what Trade.io plans to do to save the funds. However, one option that they are considering is a fork.
Even though the suspension of TIO tokens includes Trade.io, they released another annoucement after the hacking, which is called, “Important Notice: Only trade TIO on trade.io.”
A liquidity pool is the same from cryptocurrency to fiat currency – a common source of money that backs up the trades for the applicable market. With Trade.io’s pool, there were 50 million tokens from the firm, plus some of the revenue and contributions from users on the database. Any user that ends up decided to deposit is credited with interest, and they have the option to withdraw their contribution at any time. Based on information from Trade.io, this function is working at this point.
A cold wallet is just a crypto wallet that has no internet connection and is instead held on compatible hardware. The only way for someone to access this type of wallet is to physically have the wallet in hand. According to Trade.io,
“We use industry recommended cold storage which are maintained in safety deposit boxes in banks, along with all corresponding materials. We have confirmed that the safety deposit boxes were not compromised.”
In a post from KuCoin Mod on Twitter, the exchange told the public,
“Apologies for the inconvenience. We are temporarily closing all trading for TIO because trade.io is preparing to fork TIO. Rest assured that your funds are safe. Your kind patience and understanding are highly appreciated. Thank you.”
The fork discussed by the Twitter post and by Trade.io would basically make the stolen tokens have zero value. The only way for holders of these coins to use them is with the upgraded version of them. The annoucement from Trade.io concluded by saying,
“It’s obvious that trade.io is now a major focal point of competitors and those attempting to destroy the movement that is on the ground floor, and we guarantee you we will not bow down to their actions. We have the strongest community in crypto and we assure you we will wind up stronger as a result of actions like these and any such attacks in the future.”
Overall, the company wants to ultimately open an exchange that handles multiple assets with full decentralization. Optimally, the assets would include cryptocurrency, fiat currency, and financial derivatives from physically commodities.
Between the pre-sale and the ICO last year, the company managed to bring in $51 million, which is what formed their liquidity pool. By January 2018, the token was listed on CoinMarketCap.com, though their original goal was almost three times higher ($135 million). In July of 2018, the exchange was officially launched.
Since the token was originally launched, the company there have been multiple partnerships established in collaboration. Civic Technologies was among the first, which is a company that adapts blockchain technology for identity verification. Bancor was added around the same time, which offers services that make it easier for tokens to be exchanged. However, the annoucement revealed that Bancor would no longer be affiliated.
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