Crypto broker FPG faces $20 million cyberattack, halts withdrawals

• The group halted trading, withdrawals and deposits on its platform out of caution.
• FPG and its clients handle $50 billion in assets.

Cryptocurrency brokerage firm Floating Point Group (FPG) confirmed that it faced a cyberattack on 11 June. The firm faced losses of $15- $20 million. The group has halted trading, withdrawals and deposits on its platform following the attack.

FPG shared on Twitter that it locked all third-party accounts and migrated wallets. It later halted trading, deposits and withdrawals out of “an abundance of caution.” The firm stated that its account segregation “limited the overall impact” of the attack.

FPG is a global brokerage firm that gives institutional clients access to cryptocurrency marketplaces. FPG and its clients handle $50 billion in assets.

The company added in its Twitter thread that,

“We are working with the FBI, the Department of Homeland Security, our regulators, and Chainalysis to understand how this occurred and to recover assets. As this is an ongoing investigation with law enforcement, we cannot share specifics at this time.”

FPG voluntarily consulted cybersecurity firm Prescient Auditors in December last year and achieved SOC 2 Type 1 accreditation. This certification is a formal audit that confirms the overall security of a company’s internal data controls.

Crypto hacks worth $3 billion witnessed in 2022

The latest revelation is unlikely to improve institutional demand for the crypto sector as it is facing deteriorating market conditions and increasing regulatory enforcement actions in recent months.

Decentralized finance (DeFi) exploits occur when hackers take advantage of an open-source platform’s code to gain unauthorized access to its assets and exploit them. DeFi attacks are one of the most serious risks confronting the crypto industry.

In 2022, over $3 billion was stolen from DeFi protocols via hacks or exploits, according to blockchain analytics firm Chainalysis. The year 2022 was the biggest ever for crypto hacking, with $3.8 billion stolen from cryptocurrency businesses.

DeFi protocols as victims accounted for 82.1% of all crypto assets stolen, that is, a total of $3.1 billion, by hackers in 2022.