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NiceHash Admits It Was Hacked Amid Fears It Lost $70m In Bitcoin

Tom Jowitt is a leading British tech freelance and long standing contributor to TechWeek Europe

Bitcoin mining marketplace NiceHash admits devastating hack, which some estimates say could have cost it nearly $70m

Cryptocurrency mining platform NiceHash has admitted that it has suffered an extremely serious cyber-attack.

And there are concerns that the hackers could have gotten away with as much as $67 million worth of bitcoin, making it an extremely lucrative heist.

NiceHash has apologised and said it has reported the attack to the relevant authorities and is co-operating with law enforcement on the matter.

bitcoin
Tens Of Millions

Slovenia-based NiceHash is described as the largest crypto-mining marketplace. Essentially, it allows people to up offer computing capacity for bitcoin miners to mine digital currencies. Cryptocurrency miners work out complex mathematical equations to add cryptocurrency transactions to decentralised public ledgers (i.e. blockchains).

But on Wednesday problems with the service came to light when the mining marketplace initially Tweeted that its service was undergoing “maintenance”.

It later added it was “working hard” to resolve issues affecting the site.

But it then issued an official statement, in which it admitted that there had been a security breach involving NiceHash website.

“We are currently investigating the nature of the incident and, as a result, we are stopping all operations for the next 24 hours,” it said. “Importantly, our payment system was compromised and the contents of the NiceHash Bitcoin wallet have been stolen. We are working to verify the precise number of BTC taken.

Clearly, this is a matter of deep concern and we are working hard to rectify the matter in the coming days. In addition to undertaking our own investigation, the incident has been reported to the relevant authorities and law enforcement and we are co-operating with them as a matter of urgency.”

“While the full scope of what happened is not yet known, we recommend, as a precaution, that you change your online passwords,” said the service. “We are truly sorry for any inconvenience that this may have caused and are committing every resource towards solving this issue as soon as possible.”

NiceHash did not reveal how much bitcoin has been stolen in the hack, but users have pointed to a bitcoin wallet which holds 4,736.42 bitcoins – equivalent to $67m.

NiceHash then told Reuters that the contents of its bitcoin wallet had been stolen in the security breach.

NiceHash head of marketing Andrej P Škraba said nearly $64 million had been lost.

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Devastating News

“This is devastating news for those in the mining community,” said Tyler Moffitt, senior threat research analyst at Webroot.

“NiceHash is a fantastic way for those who use just their personal computers or small mining farms to still get consistent payments by pooling together their hashing power.

“This hack is a lesson for the community to ensure that when mining for a pool, to always have payouts trigger at the smallest amount. Even though there are fees associated with using the minimum payout, having the amount sit in the mining pools wallet is risky.”

“It doesn’t take much for mining pool operators to keep these types of wallets secure. If you don’t, this is what can happen. It will be a huge uphill battle for NiceHash to overcome this breach as it’s very damaging to its brand.”

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