$3.6 Million Cryptopia Hack Sparks Investigation by New Zealand Police

New Zealand-based crypto exchange Cryptopia is the latest victim of a major cryptocurrency exchange hack that resulted in at least $3.6 million in lost funds.

Cryptopia first noticed the hack due to detected malicious activity on January 14, which led them to abruptly shut down their website and exchange services.

Following the immediate shutdown, Cryptopia informed their users via Twitter that the exchange suffered a security breach resulting in significant losses:

Per Cryptopia’s announcement of the hack via Twitter, concerned and worried users flooded the exchange’s feed with questions.

However, Cryptopia couldn’t respond as they said they will not be commenting on the ongoing proceedings because the New Zealand police has officially launched an investigation.

Ongoing Police Investigation

According to the police, the investigation has just begun as it’s in the stage of ascertaining the sequence of events.

As stated in the press release:

The inquiry is still in its very early stages and police are continuing to work with Cryptopia to establish what has happened and how. Police are not yet in a position to say how much cryptocurrency is involved, other than it is a significant amount. A large team, including Canterbury CIB and specialist staff from the police High Tech Crime Unit, have been assigned to the case.

New Zealand’s local media had wrongly reported that police rushed Cryptopia’s building but investigators note that they simply have a presence at the firm’s headquarters and that Cryptopia is fully cooperating with the investigation.

Re-Launched Lawsuit Against Cryptopia

In light of the reported breach, an old lawsuit involving 2 traders who claim to have lost funds held on the exchange over a year ago is being brought back into action. Whether or not Cryptopia’s recent breach will have an impact on this lawsuit is yet to be determined.

Furthermore, a report from local NZ media and Radio NZ state that over 40 Cryptopia users have already come forward demanding an explanation as to why they cannot access their funds on Cryptopia.

According to the lawyer handling the lawsuit mentioned above, multiple people have reached out to him declaring problems they’ve had with Cryptopia.

As stated by the lawyer:

We were contacted initially by about three people [last year], including a South African lawyer, who were complaining that they were having trouble transacting using their wallets and couldn’t withdraw funds.

Whether or not the allegations against Cryptopia are true are yet to be ascertained. However, it appears the crypto exchange is under a lot of heat with the recent breach and old lawsuits being brought back.

According to the investigative police news release, they plan to provide an update on the situation today.