Bitfinex Conspiracy

Cryptocurrencies are rising significantly and people are investing more in crypto than they ever did. This is the reason why Bitcoin is standing strong at $4600 at the time of writing this. Total market capitalization has been valued at $165 Billion. This is an enormous amount for something which don't even exist outside of Internet. Actually the reality is, People are taking cryptocurrency as overnight success scheme which it isn't. That's why majority of people losing huge money in the world of crypto.

Like stocks and forex, cryptocurrencies also needs to be analyzed technically as well as fundamentally. Crypto market is highly volatile and prone to security issues as well. A recent issue of Bitfinex exchange proved the risks associated with cryptocurrency. First of all, there are no back up of any transaction. Like if you send BTC to a wrong address then you can't get them back at any cost. They will be lost forever. There are no options to get your cryptocurrency back if it has sent by mistake.

Now, let's discuss the Bitfinex Conspiracy or Should I say Bitfinex irresponsibility which cost $70 Million to their investors and traders.

Bitfinex is a cryptocurrency trading and storage platform which allows its users to trade cryptocurrency and store them in their custom account on Bitfinex exchange. Bitfinex is a Hong Kong based exchange and the largest in term of trading volume. As per the cryptocurrency stats, Bitfinex hold approximately 10% trading volume of all the exchanges in the World. So, it's pretty obvious that Bitfinex is legit and enormous entity.

Now, let's talk about the Conspiracy theory:

In early August 2016, Bitfinex exchange got hacked by someone or group of hackers, which still hasn't cleared yet, and a whopping $72 Million value of BTC has been stolen from the exchange from anonymous hacker group. This is the second largest hack in the history of Cryptocurrency exchanges. A total 119,756 BTC had been stolen from the accounts of all the customers. They were residing among the wallets of customers and all of a sudden they were empty.

This was a shocking news for the exchange as well as users or investors. Bitfinex at that moment had not been able to decide how to compensate that loss. Bitfinex reported this matter to the law enforcement and worked in co-operation with the largest Analytic companies to find the location of stolen BTC.

But this news has given a steep rise to the value of BTC. Just after the hack, BTC value plunged by 23% at $545.20 . I mean what a coincidence, with the stolen news, market plunged instead of falling. Isn't that strange?

Bitcoin always had a history of Volatility and reacts very smoothly to any news whether fake or genuine. In case of Bitfinex, same thing happened. Market plunged as soon as the news Broke which triggered an idea that may be this hack was a conspiracy by some other major exchange in order to increase the BTC price and their own business.

In fact, many people argued about it a lot at that time, still this argumentation remained a mystery. As we all know, Crypto World is full of conspiracies, Some get solved while other remains unsolved.

Thanks for reading !

Author : @cryptonet

Image 1,2