Bitfinex, a Bitcoin exchange based out of Hong Kong reportedly lost nearly $72 million of its customers’ Bitcoins.
Now, the company has decided to offer a reward worth $3.5 million to anybody who will be able to assist them in recovering the stolen amount by providing useful information.
Bitfinex informed the public about the incident on August 2. According to the statement issued by the Bitcoin exchange, they encountered a severe security breach and as a result of that they ended up losing almost 120,000 BTC.
The hack led to a loss of 36% for every Bitfinex customer. The company has decided to issue tokens, which each of those customers will be able to redeem the moment the company is ready with the amount required for reimbursing all the losses.
Bitcoin exchange Bitfinex offers 5% of the total funds lost (around 6,000 BTC) as a bounty for helping them in recovering the lost Bitcoins.
The news came after a user on Reddit known as “someguy916” asked whether Bitfinex has any plan of rewarding the individuals helping them in recovering the stolen currencies.
The question was answered by Zane Tackett, the community director of the Bitcoin exchange.
In his reply, Tackett said that any individual, who will be offering information that will assist the company to recover the money, will be awarded a bounty.
Here, it must be mentioned that $3.5 million would be the amount of the bounty only if the entire lost funds are recovered.
In his comment, Tackett talked about rewarding 5% of the amount recovered to the person offering information enabling the recovery and $3.5 million is approximately 5% of $72 million, the total funds lost in the form of Bitcoin.
It’s also important to remember that if multiple individuals help in recovering a specific percentage of lost Bitcoins, the sum of the reward will be divided equally between them.
If the information provided doesn’t help in the recovery of the lost Bitcoin funds, the person will not be awarded any bounty.
Bitfinex is currently the world’s 3rd biggest Bitcoin exchange. After news came about this major hack, the price of Bitcoin dropped by almost 20%.
To prevent such incidents in the future, Bitfinex has taken some additional security measures.
According to a statement issued by the company, they have started conducting additional infrastructure and platform security checks.
In addition, Bitfinex has also regenerated all its encrypted services, which includes security tokens, passwords, and wallets.
Some other security measures adopted by the Bitcoin exchange include moving all its existing funds to multi-sig cold storage, re-evaluating all 3rd party integrations, rebuilding the entire platform on a new infrastructure, and performing an all-inclusive system audit for identifying vulnerabilities.
Experts are saying that the most effective way of keeping your funds protected from major hacks is keeping your Bitcoin offline.
According to them, users should always store their digital currencies in their own wallet and not in any cryptocurrency exchange or website.