CoinStats takes pause after security breach affects over 1,500 wallets

The CoinStats crypto portfolio app has decided to temporarily pause all user activity after it became the latest victim of a security breach over the weekend. Cybercriminals behind the hack lured CoinStats users into clicking on malicious links, falsely promising users a reward of 14.2 ETH or $48,128 (approximately Rs. 40.2 lakh). A total of 1,590 crypto wallets were affected as part of this breach. This Reportedly accounts for 1.3 percent of the total number of wallets according to CoinStats.

This is what happened

CoinStats posted an official confirmation of the hack via its X handle on June 22. The company’s post stated that the hack primarily targeted iOS users.

The post also showed a screenshot of the fraudulent message that CoinStats users received. The message claimed that recipients had won a reward of 14.2 ETH from a pool of 200 ETH. The message further directed CoinStats users to their AirScout wallets, which eventually led to a drain of funds from those wallets.

Some private keys stored on CoinStats’ servers were also reportedly breached as part of this attack, leading the company to believe that hackers may have been able to breach the internal systems from which wallets are generated for its users.

The exact amount stolen in this hack remains unclear at this time. CoinStats has issued a list of wallet addresses compromised in this incident.

What is CoinStats doing to limit the aftermath?

Following the incident, CoinStats has launched an internal investigation into the matter. In the coming days, the company plans to relaunch the app after the investigation process is complete.

The involvement of law enforcement agencies is also still unclear.

The company plans to contact affected users with updates in the coming days. So far, CoinStats has not said anything about offering compensation to affected users.

Crypto sector continues to attract hackers

In May 2024, more than $473 million (approximately Rs 3,950 crore) worth of cryptocurrencies were reportedly lost due to hacks and looting in 108 incidents, according to Immune systema security service provider.

Over the weekend, the crypto sector witnessed yet another hacking incident when Turkish crypto exchange BtcTurk claimed that it had been hacked and several hot wallets had been accessed, with crypto stolen from some of them. Binance is helping BtcTurk with the investigation and has reportedly frozen $5.3 million (roughly Rs. 44 lakh) worth of funds related to the attack.