The hack comes amidst much controversy surrounding the trading proxy for the US Dollar.
Tether has claimed that its systems were hacked. It has also claimed that tokens amounting to approximately $30 million were stolen. The company is behind a dollar-pegged cryptocurrency widely used in the market’s exchange trade.
In a recent post on the company’s website, Tether placed the blame for the attack on an external attacker. The post which has since been removed also claimed that $30,950,010 USDT was stolen. Originally started as Realcoin and later on rebranded, Tether aims to serve as a proxy for the US Dollar.
Tether can be sent between exchanges such as Bitfinex and Poloniex. When questioned about the hack, representatives from Tether said that the company would move swiftly to ensure the stolen tokens do not trade. The aim of the preventative measures taken by the company would ensure the stolen funds are not introduced back into the cryptocurrency economy.
In the website post, the company wrote that $30,950,010 USDT was removed from the Tether Treasury wallet. It was then sent to an unauthorized bitcoin address. The company also stated that it would not redeem any of the stolen tokens and that it was in the process of attempting to recover the tokens.
Tether has also stated that it will release a new version of the Omni Core software client in a bid to effectively secure the tokens which were allegedly stolen. By doing this the company hopes that nodes in the network adopt the software.
It would then effectively blacklist the stolen address and perform an emergency fork to contain the funds. Representatives from the Omni Core software project have said that the release of the new software should take place in the coming days. And, that the software will allow Tether to retrieve the stolen tokens.
Keen observers spotted the move earlier this week and this has sparked speculation about the nature of the freeze. Tether itself has stated that the tether.to back-end wallet service was temporarily suspended. It added that a thorough investigation into the cause of the attack was underway and that steps had already been put in place to prevent similar actions in the future.
Unfortunately for Tether, the announcement came amid a period of growing discussion and controversy surrounding the service. Tether has come under scrutiny for its unclear relationship with the troubled British Virgin Islands-based bitcoin exchange Bitfinex. It has faced a backlash from internet users over allegations that the exchange has been using the asset to engage in fraud and market manipulation.
And, what has undoubtedly complicated the matter even further is that many believe the two companies to have shared ownership. Having said this, the claims of a hack have further added to the controversy, which coincidently follows Bifinex’s hack last August.
During the hack, more than $70 million in customer funds were lost. Other exchanges which offer order-book trading on Tether have also taken steps to freeze trading.