$788 000 USD

JULY 2013

UNITED STATES

BITFUNDER/WEEXCHANGE

DESCRIPTION OF EVENTS

“In July 2013, BitFunder’s software was said to be hacked, enabling the theft of 6,000 bitcoin from Montrol’s companion fiat-to-crypto platform, WeExchange. Montrol allegedly failed to communicate the lost monies with investors or regulatory authorities. On one occasion, he promoted the operation as “commercially successful” instead of insolvent.”

Improper storage combined with a lack of transparency enabled this operation to continue for many years as an insolvent firm. This also shows the very real tendency of some exchange operators to hide key details of hacks that occur, which is why a mandated level of transparency is so critical. Regular audits alone are only effective if the results are communicated and verifiable by the general public.

Sources And Further Reading

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