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CertiK Reveals Kraken Bug, Alleges Threats from Crypto Exchange

Key Takeaways

  • CertiK has identified itself as the security firm involved in the alleged theft of $3 million from Kraken;
  • Kraken accused CertiK of extortion, while CertiK alleges that Kraken threatened its employees over the repayment of funds;
  • Most members of the crypto community side with Kraken.
CertiK Reveals Kraken Bug, Alleges Threats from Crypto Exchange

Blockchain security firm CertiK has publicly revealed itself as the "security researcher" accused of stealing digital assets worth $3 million from the Kraken crypto exchange.

CertiK stated in a post on X on June 19 that it had informed Kraken of a critical vulnerability, which allowed them to withdraw millions from the crypto exchange's accounts.

According to Nicholas Percoco, Chief Security Officer at Kraken, CertiK's team refused to return the funds until the exchange provided a "speculated $ amount that this bug could have caused if they had not disclosed it."

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CertiK's post countered these allegations, stating that after the company identified and helped fix the vulnerability, Kraken's security team allegedly threatened CertiK employees:

After initial successful conversions on identifying and fixing the vulnerability, Kraken's security operation team has THREATENED individual CertiK employees to repay a MISMATCHED amount of crypto in an UNREASONABLE time even WITHOUT providing repayment addresses.

The firm also shared a timeline of events, from identifying the bug on June 5 to the alleged threats on June 18. They added that they were making this information public to ensure transparency and protect users' security, calling on Kraken to stop any threats against white-hat hackers and announcing plans to transfer the funds "to an account that Kraken will be able to access."

The incident has sparked reactions from the crypto community, with many criticizing CertiK's actions as inconsistent with those of white-hat hackers and even criminal. It is yet to be determined if Kraken will pursue legal action.

Both parties are standing firm in their narratives, each claiming to have acted in the best interest of the crypto community.

In other news, CertiK recently helped identify the reasons for the $3.7 million theft from UwU Lend.

Aaron S. , Editor-In-Chief
Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.
With close to a decade of experience in the FinTech industry, Aaron understands all of the biggest issues and struggles that crypto enthusiasts face. He’s a passionate analyst who is concerned with data-driven and fact-based content, as well as that which speaks to both Web3 natives and industry newcomers.
Aaron is the go-to person for everything and anything related to digital currencies. With a huge passion for blockchain & Web3 education, Aaron strives to transform the space as we know it, and make it more approachable to complete beginners.
Aaron has been quoted by multiple established outlets, and is a published author himself. Even during his free time, he enjoys researching the market trends, and looking for the next supernova.

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