Mt. Gox Creditors Suffer Multiple Brute-Force Attempts As Repayment Begins

As the defunct Japanese crypto exchange Mt. Gox begins repaying the 2014 hack victim, the criminals are preying to steal creditors’ funds. The affected Mt. Gox creditors claimed that criminals were using brute force attempts to compromise their accounts.

As the Mt.Gox creditors expressed excitement about the looming repayments, their joy seemed short-lived since criminals sought to steal from them. On Mt. Gox’s Reddit accounts, the creditors have shared images and messages showing that criminals were attempting to compromise their accounts. 

Criminal Eye to Steal from Mt. Gox Creditors

The creditors claimed that the bad actors used brute force to gain unauthorized access to their accounts. Others suspected that the hackers were attempting to launch a cyberattack to steal the funds received from the Japanese crypto exchange. 

On Reddit, a Mt. Gox creditor named “r/mtgoxinsolvency” and several others complained that they could not access their account. The “r/mtgoxinsolvency” Reddit user confirmed receiving 15 notifications for account login attempts. He lamented to have been locked out of accessing his account.

Subsequently, other Mt. Gox creditors shared screenshots portraying several unauthorized login attempts. The Redditors expressed their concerns that Mt. Gox was under attack.

Shortly after the revelation that Mt.Gox incident, Reddit was bombarded with screenshots and images showing creditors could not log into their accounts. 

The creditors suspected criminals were using sophisticated hacking methods to compromise their accounts. 

Mt.Gox Creditors Fails to Access Accounts

From the screenshot, the Mt. Gox creditors claimed that the criminals were using brute force attacks or website glitches to gain unauthorized access to customers’ funds.

A brute force attack is a common hacking method where the attacker guesses multiple passwords and critical phrases for a specific account. 

The Reddit report shows that only a few Mt. Gox creditors accessed their accounts. The Redditors questioned why hackers attacked the Mt. Gox system while the funds were still on Kraken.

In a subsequent post, a Redditor named u/Joohansson claimed that the Mt. Gox accounts with two-factor authentication were safe from hacks and scams. The Redditor suspected the attackers had gathered confidential user information, which they attempted to gain unauthorized access.

The creditors expressed their concerns about why the criminals were preying on Mt. Gox at this time. In response to the complaints, Mt. Gox took corrective steps to protect customers’ interests. The Redditors noted that the Mt. Gox website was under maintenance after the incident.

Review Progress of Mt. Gox Repayments

The Reddit post sparked fear among the Mt. Gox community, who had eagerly waited for their repayments for nearly a decade. The Mt. Gox was once one of the largest crypto exchanges before it went bankrupt in 2014. 

The crypto exchange suffered a malicious attack, resulting in a loss of 950,000 Bitcoin worth $58 billion at the current market price. The Mt. Gox noted that the hackers launched a bug that interfered with customer transactions. 

The bug redirected customers’ funds to hackers’ accounts, commanding the Mt. Gox system to process incomplete transactions. After being declared bankrupt, the Mt. Gox received 140,000 BTC worth $9 billion. 

The recovered funds will be transferred to creditors’ accounts in the coming days. Compared to the value of Bitcoin during the 2014 hack, the creditors will receive more than they lost. At press time, BTC traded at $64,000, a 9000% increase in value from $600 in 2014.

As the crypto exchange begins repaying the customers, the renowned blockchain analytic firm Arkham Intelligence monitors the Mt. Gox BTC movement. Arkham data shows that the crypto exchange moved 91,755 BTC worth $5.9 billion on July  16. 

The analytical firm noted that Kraken received 48,641 BTC valued at $3.1 billion, which will be transferred to creditors’ accounts in the coming weeks. The Arkham confirms that Mt. Gox holds 90.43 BTC valued at $39 million. The crypto exchange is expected to repay the remaining $6.1 billion BTC before October this year. 

Editorial credit: Primakov / Shutterstock.com

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