BitBNS Says Authorities Told It To Keep Mum About $7.5 Million Hack – Here’s Why

BitBNS is an India-based crypto exchange that got compromised on February 1, 2022. But the incident came to light following ZachXBT, a crypto on-chain detective company, uncovered the incident on Wednesday. Gaurav Dahake, the founder of the exchange, conducted an Ask Me Anything (AMA) Session on Youtube on March 1, representing a gap of 13 months since the hack. Notably, the founder cited law agencies’ order as a reason not to reveal the hack publicly. 

The scam tracker company, in its tweet, uploaded a screenshot of the BitBNS’ announcement when the platform claimed the team had taken the exchange down for maintenance purposes. ZachXBT asked its followers to “call out the crypto exchange @bitbns for hiding a $7.5m hack from their users.”

Also, Gaurav Dahake should have discussed the number of stolen funds in the session. But it was ZachXBT who pointed out the stolen amount of crypto funds in the tweet. 

The founder admitted that BitBNS communicated with law agencies immediately after the hack was identified. The officials advised, “users should be educated about the incident only after the investigation is completed or reaches a dead end.” Gaurav Dahake also affirmed that the platform recovered some of the stolen funds with the support of government agents and fellow exchanges. 

BitBNS Took Platform Offline To Analyse Anomalies, Founder Says

To respond to the allegations made by ZachXBT, the founder conducted an online session hours after the on-chain sleuth firm uncovered the exploit. The founder urged; 

Most big exchanges saw such incidents. Binance had funds compromised. BitBNS too saw a small incident. Right before that incident, we had experienced irregular activities on the platform, that’s when we decided to take the exchange offline for a few minutes to analyse the issue.

He continued that investigations found prices of several coins had different values while selling and buying. And as the users were withdrawing funds at that time, the team noted that a specific amount of different tokens was being converted into Ethereum, which was sent to an account that further transferred it to multiple addresses.

Since digital assets have grown recently, crypto companies have become the favorite place for cybercriminals to target. And this exploit “was not an abnormal activity” considering big players like Binance, KuCoin, and others got compromised many times in the past, he said. 

While responding to ZachXBT’s allegations of hiding hack, the founder urged whenever an unusual activity seems to be conducted on a network, the dedicated teams “try to fix the checks and balances in place.” Likewise, the BTNs took the platform offline to analyze anomalies. 

A platform becomes more cautious about security following it hits an exploit, he admitted, saying the exchange has been functioning seamlessly since the hack.

Featured image from Pixabay and chart from TradingView.com