Bitcoin Exchange Will Look To Spread The Pain Of Recent Hack Across All Users In 'Socialized Loss'

Earlier this week, 119,756 bitcoins were stolen in a hack from the Hong Kong-based cryptocurrency exchange Bitfinex. The hack marks the second largest security breach of a digital currency exchange, and the value of the stolen currency exceeds $70 million, representing roughly 0.75 percent of all bitcoins in circulation.

The worst hack involving the digital currency occurred in 2014 when Mt Gox was robbed of 744,408 bitcoin, which was worth $350 million at the time.

Bitfinex did not offer an explanation on its website as to what happened, and it is in the process of restoring limited functionality currently, with full functionality to come at an undisclosed later time.

Related Link: What Is Blockchain, And Why Should You Care?

"We are investigating the breach to determine what happened, but we know that some of our users have had their bitcoins stolen," the exchange acknowledged.

The exchange is also looking to implement a "socialized" measure to make up for the loss. This may include spreading the loss across all clients of the firm, as speculated by Cnet.

The price of one bitcoin plunged by 23 percent on Tuesday to as low as $465.28 as news of the hack became widely circulated. However, the digital currency rebounded and was trading near the $570 mark on Friday.

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