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Police suspect BitGrail boss of stealing €120M from exchange

Italian police are accusing BitGrail operator of masterminding the cryptocurrency exchange hack, leading to the loss of 120 million euros ($146 million)

The Italian police suspect the man behind the now-bankrupt BitGrail exchange of engineering the series of hacks which resulted in a €120 million ($146.55 million) loss in cryptocurrency from the platform.

As per a Reuters report, approximately 230,000 users lost funds in the hacks, which targeted the exchange’s store of a cryptocurrency called Nano. In its statement, the postal police describe this as the most significant cyber-financial attack in Italy and one of the biggest in the world.

According to Ivano Gabrielli, director of the national centre for cyber-crimes, the perpetrator, a 34-year-old man from Florence, named only as “F.F.,” did nothing to prevent the hackers from accessing the platform after the first attack or was behind the breaches himself.

The police said that for the first time in Italy and Europe, they have recorded fraudulent and rapacious activities that negatively affected investors, and these activities were carried out entirely on IT platforms and via the use of virtual currencies.

F.F. is now facing charges of computer fraud, fraudulent bankruptcy and money-laundering. At the time of this report, there is no comment from either the man or his lawyers.

BitGrail operator could have stopped subsequent breaches

The BitGrail operator contacted police in February 2018 to report the breach and the loss of a considerable sum of Nano. Gabrielli told Reuters that after the police began to investigate the incident, it became clear that F.F. was involved.

The police insisted that it would have been easy for the operator to prevent further theft once the first hack had been spotted. However, he knowingly failed to prevent them, making it possible for more Nano coins to be drained from users’ accounts.

Cryptocurrency-related crimes are on the rise. Hackers stole more than $4 billion from crypto-related crimes in 2019, up from the $1.7 billion loss recorded in 2018. While exchanges, wallets, and other crypto custody services are strengthening their defences, hackers continue to innovate and stay steps ahead of even the best state of the art cybersecurity measures. Hackers adopt multiple techniques to evade security systems such as SIM swapping, phishing and URL hijacking.

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