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Will the hacked Cryptoapi return the funds?


Large number of clients&Cryptopia wants to know what stage the liquidation of the exchange is at and what it means for them. Will the funds that were stolen be returned?

A Cryptopia spokesperson said that the company has made significant progress in creating a good level of security and safety of assets for the benefit of those who should be entitled to them. Consider a brief description of the progress that has been achieved.

Asset security

The company now has data that was stored by one of the data processing centers in the United States. This step was very important, since this data contained the only records of customer ownership, and some crypto assets were stored exclusively on these servers.

As mentioned earlier, the company is now busy moving crypto assets in a secure environment. This precaution is necessary for the reason that the source of the hacking that occurred before this has not been identified.

The process itself began even before the liquidation of the exchange and it is necessary in order to act as a guarantee that the data will not harm crypto assets and other data that was not affected by the hack. The exchange continues to work together with international authorities to determine the source of the hacking.

How is the number of clients determined?

Why does this exchange take so long to determine the funds of its customers? There are the following problems with this:

• Customers did not have individual wallets, which is why it is impossible to determine their specific ownership using only the keys in the wallets. While Cryptopia stores information about clients ‘ assets and reports it to the exchange, the crypto assets themselves were combined in coin wallets. Since the exchange was centralized, all user transactions occurred without confirmation on the blockchain.

• The reconciliation process between the crypto assets in the wallets and the customer databases has never been completed. To determine the assets of each individual client, the exchange requires a manual process that will allow you to understand what is in the wallet pools, and then coordinate the information received with the one that is in the database. Representatives of the exchange hope that such a process will allow you to show the ownership of certain owners who have accounts. Now the company is coordinating the accounts of 900 thousand customers.

Will the funds be returned to Cryptopia customers?

Given that the reconciliation process is successful, the exchange still needs a referral from the New Zealand courts before the crypto assets can be returned to all customers.

The Company liaises with legal advisers regarding the legal status of the crypto asset-related business, as well as its relationship with clients. Thus, the hacked exchange tries to determine how it will be possible to return funds to its customers. This is quite a complex and very long process.

For example, according to the law, an exchange that has been hacked cannot be taken and reopened. The company is subject to certain legal requirements and obligations, both on the part of the country where it is registered, and at the international level, which must be observed by persons engaged in liquidation. For example, a requirement aimed at combating money laundering / know your customer (AML / KYC). It is absolutely always presented when considering any issue related to the repayment or return of assets to customers.

It is impossible to avoid such a process, it is legal in the country where the exchange is located. Until such time as the return of crypto assets occurs, the platform will conduct a dialogue with its customers in relation to the entire process. It should be noted that even those customers who have previously passed the KYC process on this site will still have to pass the verification again.

Author: Admin
23 August at 9:56
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