Heaptalk, Jakarta — Japanese crypto exchange, DMM Bitcoin, reportedly had lost about 4,502 Bitcoin (BTC), equal to US$308 million, after being illegally leaked from its wallet on Friday. (05/31)
Although DMM Bitcoin has not yet provided details about the hack, the CEO of Tokocrypto, Yudhono Rawis, perceived multiple possibilities. According to him, the most common issue is hacking DMM Bitcoin hot wallets, whereby hackers can access and transfer substantial amounts of Bitcoin. The connection between hot wallets and the internet is more vulnerable to attacks than cold wallets stored online.
“This incident could also be caused by internal companies misusing their access to steal Bitcoin. The issue can ensue in various methods, such as Bitcoin transfer to a personal wallet or manipulation of the internal system,” Yudho comments on the issue when asked by the Heaptalk team.
Further, he elaborated on the malware or system vulnerabilities present on the DMM’s platform, which could also lead to hackers’ exploiting to steal Bitcoin assets. Malware can rob login information, wallet keys, and other critical data that allows them to thieve this crypto asset. Although unlikely, leaks can also occur as human error, including DMM Bitcoin staff accidentally sending Bitcoin to faulty addresses or entering incorrect information when making a transaction.
“I notice multiple primary factors contributing to DMM Bitcoin’s exchange hacking incidents, which are common cyberattack patterns. Insufficient safeguards to obstruct unauthorized access may also occur due to lack of robust encryption, inadequate authentication protocols, and neglect to implement appropriate access controls.” Yudho said.
Hefty protection should be implemented
Yudho revealed that crypto exchanges need to perform multiple security aspects to prevent similar incidents in the future. Based on his suggestion, the exchanges must frequently embellish encryption methods to protect wallet keys and implement Multi-Factor Authentication (MFA) for wallet access. At the same time, limiting the amount of Bitcoin assets stored in hot wallets is also a critical aspect to be conducted.
Tokocrypto’s CEO also recommended regular system security auditing as a required strategic consideration, including identifying and fixing software vulnerabilities, server misconfigurations, and protocol weaknesses. Implementing strict access controls by limiting access to sensitive systems and data to authorized users is also critical.
To deliver layered security, he also implied that exchanges utilize advanced cybersecurity tools, firewall implementation, intrusion detection systems (IDS), and intrusion prevention systems to protect systems from attacks. Crypto companies must also ensure that all software and operating systems are updated with the latest security patches.
“Hold cyber-attack simulations to test employee readiness and incident response. They must also be educated about common cyber threats, social engineering techniques, and best security practices.” CEO of Tokocrypto added.
As is known, this case is claimed as one of the most substantial hacks in the industry since December 2022 and the seventh-largest crypto hack ever. DMM Bitcoin’s loss was the second largest the region had faced after the Japanese crypto exchange Coincheck was also stolen, around US$530 million in 2018.
