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Canadian Bitcoin Exchange CAVIRTEX Shutting Down Following Breach

CAVIRTEX, one of Canada’s biggest Bitcoin exchanges, announced on Tuesday that it’s shutting down its operations as a result of a potential security breach.

CAVIRTEX, one of Canada’s biggest Bitcoin exchanges, announced on Tuesday that it’s shutting down its operations as a result of a potential security breach.

The company discovered on February 15 that an older version of its database might have been compromised. The database doesn’t contain any identification documents, but it does store hashed passwords and two-factor authentication (2FA) secrets, CAVIRTEX said in a statement.

The exchange no longer accepts deposits and all trading will be halted on March 20. Customers have until March 25 to withdraw their funds. The company is confident that its production environment has not been breached, and that no customer funds have been lost.

“Because security and the safety of customer funds are paramount to our mission and the success of Bitcoin in general, CAVIRTEX has determined to cease active operations in the Bitcoin business and to return all customer funds,” CAVIRTEX said. “We believe that the damage to the company’s reputation caused by the potential compromise will significantly harm our ability to continue to operate successfully.”

Since account credentials might have been stolen, users are advised to change their passwords as soon as possible. The company also urges users to clear their Web browser cookies.

While CAD withdrawals are currently possible, Bitcoin and Litecoin withdrawals have been temporarily disabled. Customers who want to withdraw BTC and LTC are instructed to access the User Preferences page in their accounts and fill in the address to which they want their funds to be sent.

Bitcoin exchanges are increasingly targeted by malicious actors. Earlier this week, China-based Bter reported that someone had stolen 7,170 BTC, worth roughly $1.7 million, from one of the company’s wallets. Bter is prepared to offer a 720 BTC reward to anyone who can help retrieve the stolen currency.

In an effort to prevent such incidents, the CryptoCurrency Certification Consortium (C4) and BitGo released last week a draft of the CryptoCurrency Security Standard (CCSS). The standard promotes the adoption of best security practices by organizations that store and use cryptocurrencies.

Written By

Eduard Kovacs (@EduardKovacs) is a contributing editor at SecurityWeek. He worked as a high school IT teacher for two years before starting a career in journalism as Softpedia’s security news reporter. Eduard holds a bachelor’s degree in industrial informatics and a master’s degree in computer techniques applied in electrical engineering.

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