According to multiple reports, Coinsquare, a top Canadian crypto exchange, was the target of a hack where customer information was taken, but no passwords or funds were stolen. Coinsquare is Canada’s first IIROC-regulated crypto marketplace.
On November 19th, Coinsquare said they witnessed “unusual activity” on their exchange – never a good thing. To be safe, Coinsquare declared unscheduled maintenance – effectively pulling the plug on things until they could sort it all out.
After a review, Coinsquare reported:
“No client funds have been lost. To be clear, 100% of client funds are safely held in cold storage 1:1 against client liabilities. Client funds are not at risk.”
While funds may be safe, the perps did escape with personal information like name, addresses, DOB, account balances – basically just about everything except the crypto.
In the ensuing days, things appear to have been choppy as Twitter is splattered with individuals having difficulty accessing their accounts with Coinsquare acknowledging service interruptions:
“Service Disruption – Some users may experience disruption when attempting to login to your mobile app. If you encounter trouble, we recommend deleting the mobile app and reinstalling it. Should you continue to experience issue, please feel free to reach out to our support team.”
— David Korosec (@korosec_david) November 28, 2022
On November 8th, prior to the unusual activity, Coinsquare posted a blog reassuring customers about platform security:
“Coinsquare has implemented robust protocols, safeguards, and industry-leading security technology, and we continue to protect your assets and ensure their availability regardless of market volatility. For transparency, let us walk you through why your assets are in safe hands despite what may be going on in the market.”
This post may have been a bit premature.
Coinsquare does hold crypto in third-party cold storage – along with Fireblocks for its hot wallet – in retrospect, a very smart move. Coinsquare appears to have dodged a bullet.
In the current crypto ice age, diminished trust can deeply impact a platform – that and the fact that overall crypto markets have tanked mean operating a crypto exchange can be a challenging business.