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- Bitcoin falls 3.46% and traders speculate that the temporary shutdown of exchanges could have had an impact on the price.
- Crypto exchanges Bitfinex and OKEx were hit by DDoS attacks. No losses or affected funds reported.
Price of Bitcoin continues to fall. At the time of publication, Bitcoin (BTC) is trading at $8,484 with a 3.46% loss in the last 24 hours. In the weekly chart, the drop is more significant at 10.70%. The monthly chart shows losses of 7.94%. Veteran traders and analysts are speculating about the causes.
Possible impact of DDoS attacks
The 3.4% drop in the Bitcoin price is recorded when Bitfinex and OKEx report a DDoS attack on their platforms. OKEx was the first exchange to report the attack. According to a post from the exchange’s CEO, Jay Hao, the distributed denial of service (DDoS) attack was reported on February 27. Hao claimed that the attack was made by “competitors”.
A DDoS attack is a malicious attempt to alter the traffic of a server, network or service. The attacker overloads his target with an enormous amount of traffic. The attack on OKEx diverted about 200 GB per second of traffic to the platform, in a first wave. Hao reported a second attack a few hours ago:
We’ve detected a planed DDOS attack to our site, 200G yesterday & 400G just now.
A message to OKEx users & communities: Be assured, OKEx is well-prepared to deal with these attacks, we have and will always protect our users no matter what.
At the same time, Bitfinex also reported a DDoS attack. According to the exchange’s status page, this attack lasted about 45 minutes. Both platforms were taken out of operation. OKEx suspended option and futures trading for 40 minutes to make an update. The exchange notified its users that their funds would not be compromised during the upgrade.
Since then, the platforms have resumed their services. Bitfinex notified that they will continue to investigate the incident. In the meantime, they claimed to have implemented a stricter level of protection in case of a second attack. Bitfinex CTO Paolo Ardoino said the attack was highly sophisticated. In addition, once he heard about the OKEx attack, he said he was interested in comparing similarities.
Although there is no direct correlation between the attacks on the above platforms and the drop in the price of BTC, veteran traders speculate that there may be precedents. Trader Nick Chong published a chart to show how the market may have been affected. Chong also stated that in 2018, a similar situation occurred when BitMEX temporarily closed for an update. At that time, the BTC price dropped by $300 until the platform became available again.
I'm skeptical Bitcoin has been trading weak due to the DDOS situation. Though, here's a chart I quickly made using status information from Bitfinex:
First horizontal is when Bitfinex started experiencing service issues
Second horizontal is around when the site went down. pic.twitter.com/daFULsXRtL— Nick Chong (@n1ckchong) February 28, 2020
None of the exchanges have reported losses or affected users. However, it is necessary to wait for a full report, after the platforms finish their investigations. OKEx’s CEO offered a reward for anyone who can provide information about the attack. Hao said he would “personally pay twice” what the hacker or the team that attacked the platforms would have received.
Plus a message to any team who got paid to do this (also to @bitfinex), if you're willing to cooperate with @OKEx team and expose the malicious buyer of the DDOS attack with evidence, I'll personally double pay you. #DoTheRightThing for the industry. pic.twitter.com/neeJBsf5Qa
— OKX Intern (@okx_intern) February 28, 2020
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