NZ Police issues update on suspicious Cryptopia hack, says “significant amount” stolen

Authorities in New Zealand are not ruling out the possibility of an exit scam during their investigation into a crypto exchange hack that occurred earlier this month. According to an update by the NZ Police Media Center, the amount of stolen funds is “significant.”

Between January 14 and January 15, NZ-based crypto exchange Cryptopia allegedly learned that it got breached, with the hackers stealing digital currency from its customers. A backlash quickly ensued, with many users believing the exchange had faked its own data breach to perform an exit scam (some users claimed their Ethereum wallets were drained right before the shutdown). Cryptopia then notified the appropriate authorities and started an investigation into the breach.

The New Zealand police has since issued two separate updates on the hack. Some highlights from the first update:

  • Police are not yet in
    a position to say how much cryptocurrency is involved, other than it is “a
    significant amount”
  • There has been “a
    visible police presence” at the company’s headquarters as police take the steps
    needed to progress the investigation
  • The operation includes
    both a forensic digital investigation of the company, and a physical scene
    examination at the building
  • Police is aware of the
    exit scam speculation. Their official stance is: “It is too early for us to
    draw any conclusions and Police will keep an open mind on all possibilities
    while we gather the information we need.”
  • Police has made it a
    priority to identify and recover missing funds, but suggests those affected should
    not get their hopes up as “there are likely to be many challenges to achieving
  • Cryptopia are cooperating
    “fully” with the investigation team

In a second notice issued by the Police Media Center, investigators say “good progress is being made and positive lines of enquiry are being developed to identify the source of the transfer, and to identify where the crypto-currencies have been sent.”

in the investigation include both local and foreign digital forensic
investigators, as well as overseas authorities. The Police again underscores Cryptopia’s
assistance in the investigation, perhaps in an effort to dispel any negative
speculation surrounding the breach. Authorities expect the investigation to
take some time to complete, the notice also said.

is not uncommon for a cryptocurrency exchange to fall victim to a targeted
attack. Cryptocurrency transfers are hard to trace while stolen funds are even
harder to recover, making crypto exchanges a lucrative target for hackers.

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