Lykke cryptocurrency exchange has suspended withdrawals following a security breach on June 4, as per a social media announcement made on June 10. The exchange assured users that their funds are secure and will be recovered.
The attack impacted both Lykke UK and Lykke Corp AG, as mentioned in the post. Withdrawals have been paused as a precautionary measure, according to another announcement in the same thread.
Established in 2015 and headquartered in Switzerland, Lykke is a centralized cryptocurrency exchange that prides itself on being a “no fee crypto exchange” and traces its roots back to a well-known forex broker.
A blockchain security researcher named SomaXBT uncovered the breach on June 9, accusing the team of trying to conceal the security breach. The researcher claimed that $19.5 million worth of crypto assets were lost due to the exploit. They shared a screenshot of a Discord message allegedly from the team, which mentioned that the exchange was undergoing unexpected maintenance.
On June 8, a user on X complained about Lykke not functioning properly and rumors circulating about a potential hack.
In response to the attack, the team at Lykke apologized to affected users on June 10. They reassured clients that the exchange has strong capital reserves and a diverse portfolio to absorb any losses from the breach, ensuring that client funds are safe. The team also stated that they have identified the IP addresses of the attacker for a criminal investigation and have hired a cybersecurity team to recover the stolen assets. The team estimates that over $22 million was lost in the attack.
Centralized exchanges continue to be targeted by hackers, with Rain exchange falling victim to a $14.1 million hack two weeks prior to Lykke’s breach. Rain stated that no customer funds were lost as they were able to cover the losses from their own reserves immediately.
In a related incident, Japanese exchange DMM experienced a $305 million loss in Bitcoin due to a private key hack.