Security News > 2021 > August > Japanese cryptocoin exchange robbed of $100,000,000

Important Notice: We are sorry to announce that #LiquidGlobal warm wallets were compromised, we are moving assets into the cold wallet.

In a cold wallet setup, the files that constitute your cryptocoin stash are inaccessible to malware or hackers who manage to wriggle into your computer, thanks to being kept offline, and unusable in the event of an intruder in your house finding the storage device on which you stashed them, thanks to being encrypted.

If you give someone hot wallet access, and they then move your funds into a cold wallet of their own, as described above, that's safer than having your cryptocoins available for immediate online trading, but it's nevertheless not your cold wallet, so the person who created that cold wallet still has control over your funds.

If you want to compare cryptocoin walletry with social media access, setting up a "Hot wallet" is a bit like deliberately logging into your Twitter and Facebook accounts on someone else's laptop, going through the necessary authentication processes to grant yourself full access.

Most exchanges will track cryptocurrency wallets into which stolen coins were transferred, especially in high-value raids like this one, in an effort to blocklist payouts that might be used to convert the looted funds back into cash, or to launder them into other types of cryptocoin.

If you plan to buy and hold cryptocurrency, keep as much of you can offline in what's known as a cold wallet.

News URL

https://nakedsecurity.sophos.com/2021/08/20/japanese-cryptocoin-exchange-robbed-of-100000000/