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The world's largest cryptocurrency exchange, Bitfinex, has reported being a victim of a distributed denial of service (DDoS) attack. The attack resulted in the service being unavailable temporarily, frustrating traders as they try to make profits from the volatile price surges and dips experienced by bitcoin and other cryptocurrencies.
The company tweeted earlier today it was under heavy DDoS attack and reported that its application programming interface was also down.
We are currently under heavy DDOS. API is also down. We are working on further mitigation.
— Bitfinex (@bitfinex) December 12, 2017
This the second time in a week that the exchange has reported a DDoS attack. Last week, the company had said that it "has been under significant denial-of-service attack for the past several days," and the attack worsened on December 7. Today, the company said it started experiencing the DDoS attack around 9:45 am ET.
In previous reports, security researchers had revealed that it's not only the criminals who are trying to leverage the newfound popularity of cryptocurrency, but the industry itself is using these attacks to take down competition or manipulate prices.
Considering its volume and popularity, Bitfinex has remained at the center of controversies with some accusing it of shady business practices. Only last month, when cryptocurrency startup Tether (which reportedly shares common ownership with Bitfinex) alleged that hackers stole $31 million from the startup, reports had once again pointed to the "long-standing allegations the exchange has been using the asset to engage in fraud and market manipulation." The $72 million hack of Bitfinex last year was also accused of being an inside job.
With so many controversies floating around, the company could have easily attracted attention of criminals or affected victims. And then, there are always those rumors that these DDoS attacks are launched by the company itself or its competitors to manipulate coin prices since traders are essentially at a standstill and can't buy or sell their cryptocurrency. While many point to these attacks as inside jobs, it should be noted that bitcoin exchanges have a long history of being attacked. As the value and popularity grows, they will become even more vulnerable to targeted attacks.
Coinbase service was also down earlier today. However, the company said it was due to site maintenance.