Mt. Gox K.K., the collapsed trading platform for the bitcoin digital currency, came under so-called distributed denial of service (DDoS) attacks aimed at shutting its servers by overloading them with massive volumes of data in early February, it has been learned.
Also between February and earlier this month, bitcoin exchanges in Canada and Slovenia were hit by similar attacks, indicating such cyber-attacks have been launched on a global scale.
According to sources, the Tokyo-based Mt. Gox was struck by cyber-attacks aimed at stealing bitcoins beginning Feb. 7 by exploiting security shortfalls in its system. Separately, it came under major DDoS attacks, with the system accessed 150,000 times per second. The attacks mostly from servers in the United States and Europe continued for several days. The company suspended bitcoin withdrawals on Feb. 10.
DDoS attacks often hijack a large number of computers with viruses. According to the sources, perpetrators often launch such attacks to steal data when a company tries to mend defects in its system.
Although the DDoS attacks failed to shut down Mt. Gox’s system, subsequent attacks targeted flaws in its system, stealing a massive amount of bitcoins.
In mid-February, a Slovenian bitcoin exchange temporarily suspended trading due to a system glitch caused by cyber-attacks. A Canadian bitcoin exchange announced that it has lost 896 bitcoins, the equivalent of ¥60 million, due to cyber-attacks, while another exchange reported that more than 12 percent of its bitcoin holdings was stolen.
“[The attacks] are probably launched by multiple hackers who want to boast they broke into the bitcoin systems,” said Tetsutaro Uehara, a professor of information security at Ritsumeikan University. “DDoS attacks can be done without high-level hacking techniques. It is possible that copycats turned their eyes on other exchanges after weaknesses in Mt. Gox’s system were found.”
One week after Mt. Gox filed for bankruptcy protection, the bitcoin community is still puzzled over what exactly caused the company to go under. What are believed to be in-house documents of Mt. Gox, including a draft detailing the purported theft, are circulating on the Internet.
Around Feb. 25, before the company suspended business, English documents titled “Crisis Strategy Draft” reporting 744,408 bitcoins had been stolen were posted on the Internet. The damage was almost the same as the figure cited by the company when it collapsed.
Earlier this month, a self-proclaimed Russian hacker posted audio recordings of alleged conversations between Mt. Gox Chief Executive Officer Mark Karpeles and a Japanese megabank official, who urged him to close the company’s account in the bank. According to sources, the recordings are believed to be genuine.
The “Russian hacker” also posted the design chart of the Mt. Gox computer system.
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