British cryptocurrency exchange Lykke has suffered a significant setback, losing over $22 million in a recent cyberattack. The exchange, based in the UK, abruptly halted all trading activities on June 10 in response to the security breach that occurred the previous week.
In an official statement, Lykke confirmed the cyberattack and took immediate action to suspend trading and withdrawals to prevent further damage. The platform identified the IP address of the perpetrator behind the attack and launched an investigation into the incident.
Prior to Lykke’s acknowledgment of the breach, on-chain investigator SomaXBT had already raised concerns about the exchange concealing the cyberattack. SomaXBT revealed that hackers had made off with 158 BTC and 2,161 ETH, totaling approximately $19.5 million. MetaMask developer Taylor Monahan later confirmed that the total amount stolen was $22.4 million.
Further investigation revealed that the hacker had laundered the stolen Ether by exchanging them for DAI, an algorithmic stablecoin issued by MakerDAO, while the Bitcoins were transferred to various wallets. It is common for hackers to move stolen funds to different wallets before legitimizing them using a coin mixer.
The cyberattack on Lykke came shortly after the UK’s Financial Conduct Authority (FCA) issued a warning against the exchange for offering unauthorized financial services. The FCA cautioned UK investors to be cautious when dealing with Lykke, as the exchange was not registered, preventing investors from filing complaints with the Financial Ombudsman Service or being protected by the Financial Services Compensation Scheme (FSCS).
This incident is just the latest in a string of security breaches that have plagued the cryptocurrency industry in recent weeks. Following the DMM Bitcoin hack on May 31, where cybercriminals stole 4,502.9 BTC (equivalent to $320 million), the Japanese exchange is seeking to raise funds to reimburse affected customers. Despite fundraising efforts, the DMM Bitcoin hack remains one of the largest in the history of cryptocurrency exchanges, highlighting ongoing vulnerabilities within the sector.
The total value of stolen cryptocurrency assets in 2024 has already surpassed $600 million, according to data from DefiLlama. This figure exceeds the $433 million recorded in the first half of 2023, indicating a concerning rise in the frequency and scale of cyberattacks targeting the crypto industry.