Shapeshift Compromised in Hack
Shapeshift has been down the past few days according to their site for scheduled maintenance. According to the CEO of Shape Shift their servers had a security breach. The reassuring part is that the way they’re designed Shapeshift doesn’t hold customer balances, so even in the case of a security breach, there is no customer money at risk.
And then there’s the school of thought that these hackers don’t even exist. That the hacksawing is an inside job–Gox, Cryptsy, all of those.
How does this affect customers?
Since Shapeshift only takes funds being offered, and pays back (almost instantly) the user selected cryptocurrency, it only holds unwanted funds. There aren’t many cases where shapeshift hasn’t been able to complete a conversion.
Shapeshift.io does not currently offer wallet services. This is important to understand, as they only hold enough cryptocurrency to make the exchange process possible. Although they clam they’re “not an exchange” to convert cryptocurrency instantly, it may take up to an hour to go through. We have never lost anything to shapeshift, every transaction has gone through without a hitch, but past results does not ensure future promises.
Crime is nothing new, Shapeshift Powers Through
As always, cryptocurrency community is still susceptible to crime and theft. This is nothing new, and should not act as a deterrent to cryptocurrency investing. Never put in more than one can afford to lose, and always be extra cautious. Just because crime happens, doesn’t mean that the community is unsafe or dangerous. In fact, the community does an amazing job of reporting these problems nowadays, but it definitely affects how larger entities, such as banks and governments look at cryptocurrency services.
A portion of their own hot wallet inventory funds were taken, but that will not interfere with operations once a new environment redesigned.
Bitcoin Services Continue to Get Hit with Service Interuptions
This event is a small part in illustrating one of our premises which we continually touch upon. Which is that many of these services created around crypto currencies are subject to instability, whether it’s a hack or internal corruptness, or unforeseen events leading to a sudden disruption of services. In this case the hack won’t compromise the user base as there are no accounts and hence no funds stored on their end. Shape shift’s hot wallet is still compromised. The cryptocurrency-verse is still unchartered territory, it’s still vastly unexplored and lawless. This makes the space subject to volatility, yet it still remains ripe with opportunities.