New Exchange Security Ranking Released, Hackers Target Gate.io

In a new ranking of cryptocurrency exchanges by the level of security they provide, the US-based crypto exchange Kraken comes out as number 1, judging from criteria like reliability of key storage, technical security, as well as how it handles user’s personal data. The ranking comes out just as news broke that hackers may have been able to hijack bitcoin transactions made on cryptocurrency exchange Gate.io.

The assessment tool that ranks exchanges by the security they offer was developed by cyber security firm Group-IB as a way to determine the appropriate insurance premiums for users who wish to insure their holdings on exchanges through a service known as CryptoIns.

As a result of Kraken’s high score, users of that platform received the lowest insurance premiums when they insure their crypto holdings. Following Kraken came the major crypto exchanges Bittrex and Coinbase Pro with the second lowest insurance premiums.
Chinese crypto exchanges OKEx and Huobi Pro, as well as Japanese exchange Coincheck, a victim to a major hack in January, were deemed to be among the riskiest exchanges to use, the ranking revealed.

In addition to technical aspects, the ranking looked at how the exchanges handled know-your-customer (KYC) and anti-money laundering (AML) procedures.
“This assessment focuses on open source data — white papers, information about founders, security policies. In some cases, with founders’ consent, the assessment includes penetration testing using social engineering methods aimed at the network compromise through the most vulnerable link at any organization— humans,” Group-IB wrote in an update on its website.

In a previous ranking of exchanges by rating agency ICORating, Kraken again stood out as one of the most secure exchanges, coming in at second place. On the first place was Coinbase Pro, while BitMex secured the number three spot. Other notable exchanges on the list were Binance on 17th place, HitBTC on 18th place, and Bitfinex on 54th place.

The new security ranking comes out just as news broke that hackers have successfully breached the website StatCounter.com and inserted malicious code in its site-tracking script.
According to Matthieu Faou, the malware researcher who first noticed the breach, hackers may have been able to hijack bitcoin transactions made on cryptocurrency exchange Gate.io, as reported by ZDNet on Tuesday.

Statcounter.com is a service similar to Google Analytics, and companies loads the now-breached site-tracking script to view their website analytics.
“We contacted [StatCounter], but they haven’t replied yet,” Faou told ZDNet.
However, it appears that Gate.io removed the StatCounter script from its website once it became aware of the breach, although no statement has been issued by the exchange.
“Gate.io doesn’t use StatCounter anymore, thus Gate.io customers should be safe now,” Faou confirmed. It remains unclear how many, if any, bitcoin was actually stolen before the breach was discovered.


Source
Author: Fredrik Vold
Image Credit

Tether Floods Into Kraken Exchange, Where Crypto Traders Can Get Dollars

Tether (USDT) tokens are flooding into a wallet address controlled by the Kraken exchange, one of the few places where the troubled stablecoin can be converted into U.S. dollars.
The exchange’s wallet balance stands at nearly 47.8 million USDT at the time of writing, making it the eighth-most valuable wallet holding this asset, according to the Tether Rich List.
Contrast that to the situation less than two weeks ago, on Oct. 7, when Kraken’s tether wallet ranked much lower – 22nd place – and held less than half its current balance: 21.6 million USDT. Archived versions of the rich list show the wallet balance fluctuating between around 10 million and 24 million USDT in the period from late December 2017 to early October.
The current balance, in other words, is a notable outlier. The implication, some market watchers have argued, is that traders wish to exchange their USDT for dollars.

Kraken is one of the few exchanges that offer direct trades between USDT and dollars. (Others include Bitfinex, which is closely tied to Tether Ltd., the issuer of USDT, and Bittrex.) So the influx is a sign that the cryptocurrency market may still harbor doubts about USDT, which saw its exchange rate fall significantly below its $1.00 peg earlier this week.
For instance, on Thursday a Twitter user going by the name Soleil Du Soir posed the question, “What are the reasons to transfer USDT to [Kraken]?” Another user answered, “You can get USD there.”
Indeed, Kraken only offers one Tether pair, USDT/USD, so traders cannot exchange USDT for other cryptocurrencies on Kraken.
There are other indications that traders are heading to Kraken to offload USDT. On Oct. 15, the date that saw tether’s exchange rate fall the farthest against the dollar, the greatest selling pressure was on Kraken, where USDT briefly touched $0.85. Tether trading volume for that day was the highest it’s ever been on the exchange.

According to the 2016 white paper for tether, token holders are able to redeem their USDT for U.S. dollars by returning them directly to Tether Ltd. In practice, a number of users have been unable to do so in recent months.
Jeff Perrin, the founder of Spiga, a fintech startup, said that he tried to redeem tether tokens for dollars through the company’s site in January or February. He provided all the necessary know-your-customer information, he said, but did not receive any responses from customer support. As of mid-October, he said, his account was “pending approval.”
Oguz Serdar, a full-stack developer and the CEO of the marketing startup Limk, described a similar experience in December 2017, saying his account had been “stuck in their verification process for months.”

Some have claimed that redeeming tether is still possible. Dovey Wan, a partner at the investment firm Primitive Ventures, wrote recently, “two of my trader friends have successfully redeem[ed],” and posted a screenshot.
Yet a Twitter user going by “Auditcarlo,” who is a virulent critic of Bitfinex and Tether, said the screenshot appeared to show trades on an exchange, not redemption through Tether Ltd. Wan did not immediately respond to a request for clarification.
With users apparently unable to convert their USDT into dollars in the way envisioned by Tether’s white paper, they seem to be trying to accomplish the same goal by moving tokens onto Kraken.

The official Kraken Support Twitter account addressed potential reasons for the increase in Kraken’s Tether balance: “traders will transfer USDT to Kraken, sell it for USD at whatever rate the market is willing to pay for it at the time, and then they can use the actual USD to buy other cryptocurrencies.”
Soleil Du Soir responded to that tweet, asking whether USDT was likely to crash, and Kraken Support replied, “Not necessarily. Not everyone who transfers USDT will sell right away or at any price. Some might be using it for margin trading. Some might be using it for [over-the counter trading]. There are many possibilities.”

Despite being the eighth-most valuable cryptocurrency by market capitalization, Tether has long been a subject of concern in the cryptocurrency community, since many doubt that its tokens are fully collateralized by U.S. dollar deposits, and the company has not provided regular public audits, as it said it would in the white paper.


Source
Author: David Floyd
Image Credit