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Bitcoins worth millions stolen from Coinsecure wallet

Sheetal Sukhija - Saturday 14th April, 2018

NEW DELHI, India - An Indian cryptocurrency exchange, Coinsecure said on Friday that bitcoins worth nearly $3 million or Rs. 19,57,05,000 was stolen from its wallet.

The robbery became the biggest reported incident in the country's fledgeling virtual currency market and is feared to further weaken trade in cryptocurrencies.

Coinsecure, which boasts of over 200,000 users trading on its platform daily, said in its statement that around 438 bitcoins, which were stored in a password-protected virtual wallet were siphoned off to an unknown destination on the internet after the details were leaked online.

The company said in a statement posted on its website, “We regret to inform you that our bitcoin funds have been exposed and seem to have been siphoned out to an address that is outside our control.”

Coinsecure also stated that it would compensate customers for losses from its existing funds.

According to cryptocurrency exchange Coinome, on Friday, bitcoins were trading at Rs. 4,80,000 or about $7,359, which was well below its international market price of about $7,771.

The Indian government has already likened trade in cryptocurrencies to "Ponzi schemes" that offer unusually high returns to early investors.

Following the reported robbery, legal experts have argued that instead of imposing restrictions on its trade, there was a need to regulate the virtual currency market.

Anirudh Rastogi, founder and managing partner at TRA Law, which specializes in emerging-technology businesses, said, "It is for reasons like these that there is a need to regulate crypto-exchanges. Pushing the exchange business out from the formal economy to the informal cash economy to operate under the radar will worsen the problem, not solve it.”

The Reserve Bank of India has barred banks from facilitating trade on virtual currencies and mandating them to unwind their existing relationship with exchanges within three months.

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