MapleChange Cryptocurrency Exchange Hacked

On Sunday, 28th of October, a relatively unpopular cryptocurrency exchange based in Canada, MapleChange, published a series of tweets claiming that they have, apparently, been hacked.

MapleChange lost 913 Bitcoins, a total value of $5,720,858 as of the moment of writing.

The cyber attack was referred to as a “bug”, which resulted in the withdrawal of all the funds of the exchange’s platform.

The Canadian exchange reportedly conducted an investigation and no user was able to access its funds during that time.

MapleChange Tweet

MapleChange tweet

Shortly after their initial tweet, however, a series of follow-up tweets sparked controversy, resulting in several “red flags” that hint towards an exit scam.

After the (relatively short) investigation, MapleChange announced that it will not be paying back any user of the exchange and closed down their website and all of their Social media channels.

Followup tweets by MapleChange

Followup tweets by MapleChange

Here is where it gets interesting…

 

Being unable to pay back users due to a massive hack makes perfect sense, at least for the time being.

But why would MapleChange delete its online presence that soon?

Suspicion and questions start to bubble up, especially on Twitter, where industry leaders like Changpeng Zhao (Binance), Joseph Young, and BitLord tweeted about the incident.

 

 

Joseph Young, a crypto-centric journalist and analyst, shared the news explaining that MapleChange had likely pulled off an “exit scam”, later bashing small exchanges. He believes in situations like these, small exchanges are focused on high profitability, while disregarding how their customers funds are protected.

 

Proving once again that “not your keys, not your coins”.

 

BitLord, one of the most followed cryptocurrency influencers on Twitter, did not keep quiet either. The young Australian explained to its followers that small exchanges like MapleChange should never be the primary exchange for trades, as small and relatively unpopular exchanges can often be hacked or, like this case, act as a forefront of large scale scams. Being careful when choosing his exchanges, he concluded, was the reason he managed to stay in the crypto space for such a long time without suffering unexpected losses.

Last but not least, Changpeng Zhao, CZ to most, the founder and CEO of Binance, tweeted that cryptocurrency enthusiasts should avoid exchanges that don’t have transparent information with regards to their cold storage wallets. A lack to provide this solution, by any given platform, should be considered a red flag and, therefore, avoided at all costs. He further mentioned there should be a way for customers to rank exchanges based on their cold storage holdings by checking the exchanges’ wallets and urged everyone to be more careful.

As the incident gained traction, a Twitter page called Maplechang’ed was created to help bring the ones responsible for the hack, to the light and, hopefully, to justice.

Since the hack of 913 Bitcoins was seen by many as an inside job, the group behind Maplechang’ed started to analyse the history and activities of the exchange’s leading team.

According to recent Tweets, Maplechang’ed managed to find relevant information which, unfortunately, confirms the assumptions of many skepticisms and crushes the hopes of refunds.

The domain registry information was fake…

But that didn’t mean a dead end. The information still has connections to several people, organisations and projects. According to the same source, the CEO of the hacked exchange had strong ties with a popular mining pool, ETZmine.com, and a cryptocurrency project called Weycoin.

While their connection to the apparent scam is yet to be defined, the story does seem to be deeper than their 140-character tweet. And we will certainly follow-up and update the article as soon as we have more information.

In the meantime, if you hold coins on several exchanges for arbitrage trading, or you simply got introduced to cryptocurrency by using a smaller exchange, do yourself a favour and research the platforms you use.

Read reviews, check their Twitter and find the leading team on LinkedIn. Who are they? What do they do? What is the % of daily volume of a certain coin on this exchange?

Ask yourself these questions and keep surfing the wavy sea of the cryptocurrency ocean. The space is still wild and underdeveloped. Therefore, make sure you keep your coins safe and only invest what you can afford to lose.