Bitfinex Plans to Distribute the Hack Losses between the Customers

News and Analysis

Hong Kong-based exchange Bitfinex has stated that the losses incurred due to the recent hack may affect all of its users, including those whose wallets were not hacked in the first place.

“We are leaning towards a socialized loss scenario among bitcoin balances and active loans to BTCUSD positions,” the exchange’s administration stated on the official blog.

Bitfinex is still in the process of determining the positions and balances of users and intends to provide more information soon.

In the aftermath of the attack, the administration refuses to contact media and the community, so all related information is available only on the official blog and on Reddit. In particular, that’s where the statement that all users will incur losses was published in the first place.

“This solution is quite disappointing. It means that our rights as lenders might not be protected,” Beijing-based coder Tian Jia, who deposited nearly $440 thousand at Bitfinex, commented.

“If this leads to legal action against Bitfinex/BitGo it’ll raise a lot of interesting questions about how wallets and custody work,” Peter Todd of Bitcoin Core stated.

Whereas most users were negative about the statement, Chinese entrepreneur and crypto-investor Chandler Guo stated that distributing losses among all users may be a good solution in the short run, provided Bitfinex reimburses the losses in the future. He also suggested that users may have a share in the company’s charter capital, or dividends from the exchange’s revenues.

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