KuCoin: Tokens are stolen, but some can still be locked in

At the end of September 2020, KuCoin discovered unusual outings from its online wallets. The compromise concerns several assets, for a total valued at around $280 million. The problem is not limited to a single currency or a single recipient.

KuCoin says private keys to hot wallets have been compromised in a persistent attack. A valid key can produce a transfer that the blockchain recognizes as authorized, while the owner obviously did not want to make it.

The platform suspends operations, transfers reserves to new addresses and cooperates with partners. Investigators track assets; some projects or issuers have mechanisms to freeze, replace or neutralize stolen tokens.

These means do not apply indiscriminately to all cryptoassets. They nevertheless explain why an operation can succeed technically without immediately making all its product usable by the thief. The availability of money also depends on where it seeks to exchange it.

In its balance sheet, KuCoin announces about 84% of the affected assets recovered through partners and legal proceedings, the rest being covered by the company and its insurance fund. This communication does not mean that 100% of the loot has been seized from the attacker.

The international reports mention possible links with North Korean actors; the sources of this story do not allow to name an individual operator condemned for the entire flight. The story is as much a compromise of keys as a coordinated response after the first money out.