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DGEX takes new security measures after hack

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DGEX.com, the first ever NXT <-> BTC Exchange, which launched back in late 2013, has been closed for trading and cash transfer operations since July 16th, when a hacker successfully managed to steal 1.2 million NXT and 52 BTC.

“DGEX was just in the process of migrating servers and deploying sizable changes and security enhancements to the web site and operations”, Graviton, the owner of DGEX, explains.

“The attacker had triggered the DGEX server, waiting for sufficient incoming funds to arrive. Usually I transfer lower amounts to the online Bitcoin wallet and pay the withdrawals a few minutes after, expecting any attacker to be left high and dry without considerable funds. Giving way to the power of habitual conditioning of months, I slipped of this final manual security measure, and it was enough to take it the other way, winning him / them a loot worth approx. 70,000 EUR.”

http://mynxt.info/blockexplorer/details.php?action=ac&ac=15392455085897110023
https://blockchain.info/tx/22284fac41ed4e78cb531f020d8f21dd0285694809f1d048a02aae4915161ccd.

What now?

DGEX will reopen on Friday August 1st, at 6 pm GMT.

Graviton will personally cover the total loss of about 142 BTC, so customer funds will not be affected by the incident. Still, as an aftereffect of the hack, DGEX shareholders will probably not see any monthly profits for 2-4 months. Exact details will be announced as DGEX relaunches.

DGEX will reopen with a suite of new services and a 100% new infrastructure that should render hacking of customer funds practically impossible. Customers will be given control of their funds at all times through distributed client-side Bitcoin / NXT / FIMK wallets accessible through the DGEX service and shared with its appropriate automation facilities.

“I am convinced everything has a meaning – it’s not about how badly you fall but how spectacular your rising up will be”, says Graviton. “Thank you for your patience and understanding”.

Nxt Countermeasures

This is not the first, and far from being the worst, hacker attack on a centralized exchange that the crypto world has seen. Such attacks are one of the reasons why the Nxt Community wants to decentralize everything.

With Nxt Multigateway and the Multigateway Lite UI Extension available, we’re going to make the trading of crypto almost trustless. Not only that, once MGW supports fiat <-> NXT trades, centralized exchanges will start to lose their market dominance – in the meantime of course they will continue to be indispensable.

To get fiat money into the system use 3rd party exchanges like CCEDK and don’t forget to follow the guidance set out here to ensure your NXT is properly protected.

 

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