Unofficial thread - announcements regarding the Cryptopia security breach.

[xtraelv]

On 14 January 2019 Cryptopia suffered a security breach when an undisclosed amount of Crypto was taken.

Information is available but is easily lost in the discussion in other threads.

Since Cryptopia staff doesn't generally post on bitcointalk I've decided to repost their responses from other social media.

This thread is self moderated - it is only for posting announcements that are either from the New Zealand police, Cryptopia management or a reliable verified source

All other discussion or posts will be deleted.

This is not because I want to censor any discussion but purely so the announcements are easy to find and don't get drowned out by opinions.

There are plenty of threads that allow you to express an opinion.


This thread is NOT endorsed by Cryptopia. I do not work there and do not have a role there other than as a volunteer chat moderator.

I understand that some people are upset while others are more philosophical and trust that the exchange management will sort out the mess.


This thread is not for discussion - it is only to provide information to others from verified reliable sources. Media speculation can be posted in other threads about this topic but not here.


https://twitter.com/Cryptopia_NZ


https://twitter.com/Cryptopia_NZ


https://twitter.com/Cryptopia_NZ


https://twitter.com/Cryptopia_NZ

cryptopia.co.nz


https://www.police.govt.nz/news/release/update-investigation-involving-cryptocurrency-company

https://www.police.govt.nz/news/release/police-making-progress-crypto-currency-investigation

It is confirmed real. It is a generic letter that was sent to people who had contacted the police regarding the Cryptopia investigation.

https://twitter.com/Cryptopia_NZ/status/1089705760274079744

https://www.police.govt.nz/news/release/police-continue-make-progress-cryptocurrency-investigation

https://twitter.com/nzpolice/status/1098367362347163648

https://twitter.com/Cryptopia_NZ/status/1096158617022201856

While the NZ Police can state that they have handed our building back to us and that they are placing no constraints on the company resuming trading, there are a number of things that the company must consider first before any trading could recommence.

It is important to consider the timeline of this event: Firstly, the crime/hack/breach was identified on the evening of 14 January 2019. The company staff that identified the event immediately froze the exchange and locked down the platform; they then notified the NZ government authorities, first the NZ Police High Tech Crime Group and second, the National Cyber Security Centre (NCSC, a division of the Govt Communications Security Bureau or GCSB), third, the NZ Financial Management Authority.

Members of the NCSC flew from Wellington first thing the next morning at were in the Cryptopia office conducting interviews and gathering evidence by 08:30am NZST. The NZ Police High Tech Crimes Group, also from Wellington were in the Cryptopia office from noon on the same day and issued search and seizure warrants effectively taking control of the building and all of the systems.

In cooperation with NZ Police and NCSC they identified key specialist staff who were tasked with working with the investigators to clone systems to preserve forensic evidence for investigation.

This took 3.5 weeks to complete and our specialist staff have now turned to carrying the work that is necessary to ensure that assets are retained in a secure environment.

While the Police statement that they are no longer constraining our return to operations and trading, it would be extremely reckless for us to do this until we can fully identify the losses and ensure that the balance is absolutely secure. NZ legislation makes it a serious crime for a company or a director of a company to allow that company to trade recklessly thereby placing creditors assets and property at further risk. That work is now underway.

Statement made by Pete Dawson Managing Director of Cryptopia Ltd



Source: Cryptopia discord

http://www.legislation.govt.nz/act/public/2012/0024/latest/DLM2136633.html

Issuing officer may issue search warrant
An issuing officer may issue a search warrant, in relation to a place, vehicle, or other thing, on application by a constable if the issuing officer is satisfied that there are reasonable grounds—
(a)
to suspect that an offence specified in the application and punishable by imprisonment has been committed, or is being committed, or will be committed; and
(b)
to believe that the search will find evidential material in respect of the offence in or on the place, vehicle, or other thing specified in the application.

Duty of persons with knowledge of computer system or other data storage devices or Internet site to assist access
(1)
A person exercising a search power in respect of any data held in a computer system or other data storage device may require a specified person to provide access information and other information or assistance that is reasonable and necessary to allow the person exercising the search power to access that data.
(2)
A specified person may not be required under subsection (1) to give any information tending to incriminate the person.
(3)
Subsection (2) does not prevent a person exercising a search power from requiring a specified person to provide information or providing assistance that is reasonable and necessary to allow the person exercising the search power to access data held in, or accessible from, a computer system or other data storage device that contains or may contain information tending to incriminate the specified person.
(4)
Subsections (2) and (3) are subject to subpart 5 of this Part (which relates to privilege and confidentiality).
(5)
In this section,—
specified person means—
(a)
a user of a computer system or other data storage device or an Internet site who has relevant knowledge of that system, device, or site; or
(b)
a person who provides an Internet service or maintains an Internet site and who holds access information
user, in relation to a computer system or other data storage device or an Internet site, means a person who—
(a)
owns, leases, possesses, or controls the system, device, or site; or
(b)
is entitled, by reason of an account or other arrangement, to access data on an Internet site; or
(c)
is an employee of a person described in paragraph (a) or (b).

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[xtraelv]

Reserved for updates in case maximum content is reached on the OP

[xtraelv]

https://twitter.com/Cryptopia_NZ/status/1100565721799479296

https://twitter.com/Cryptopia_NZ/status/1100905722584289280


https://twitter.com/Cryptopia_NZ/status/1100964778116210690

https://twitter.com/Cryptopia_NZ/status/1101275730372059136

[robelneo]

I'm glad that there is a thread like this so we can get an update on what happens to Cryptopia and will they ever be back I've bookmarked this thread and looking forward to getting the site back there some coins that I can only trade on Cryptopia and still had a Bitsend there coming from airdrops.

[cestmoi]

Thanks  xtraelv,
I have shared your topic with the one we already have in the french community so french members are kept up to date.

topic on french board   

cheers

[xtraelv]

[cestmoi]

Cryptopia Exchange
‏
@Cryptopia_NZ

The read only site will be live today, it will show balances as at 14th Jan 2019. Please use this site to reset passwords and 2FA credentials. We are finalising a rebate process for affected users, more details to follow. Thank you for your support during the last few weeks.

https://twitter.com/Cryptopia_NZ/status/1102707249338736640

[xtraelv]

Back online - read only.

https://www.cryptopia.co.nz/Exchange

Update 1



Source : https://twitter.com/Cryptopia_NZ/status/1103152867714621440

Update 2



Source : https://twitter.com/Cryptopia_NZ/status/1103165813081686019

[xtraelv]

https://twitter.com/Cryptopia_NZ

[squatter]

This is from the email they just sent out:

If you held balances in coins that were lost in the event you will start to see Withdraws on your account for those coins. The TXID for the withdraw will not exist on the network but will detail how the coin was impacted in the event. For each withdraw you will also see a subsequent deposit of Cryptopia Loss Marker(CLM), the TXID for this will also not exist on a network but will detail the coin it represents a loss for. CLM is not a coin, it can't be traded as yet, it is just a number in the database that represents the loss for each coin for each user in $NZD at the time of the event. There are still steps to take to ensure we are taking a legal path toward reimbursement.

I read this to mean Cryptopia wasn't distributing the losses to all customers as a "haircut", especially since they are already reopening trading on many pairs.

Apparently, that may not be the case. I'm waiting for an official announcement on Twitter or Cryptopia to confirm this:

Everyone suffers the a haircut on their balance

Based on discord

BTC = 14% Haircut
LTC = 43% Haircut
ETH = 100% Haircut

And based on this figure they lost more than ETH and ETH tokens.

Trading resumed in some market but still NO WITHDRAWAL

[xtraelv]

Source: cryptopia.co.nz/







Source: companiesoffice.govt.nz





Source: grantthornton.co.nz/meet-our-people/

[xtraelv]

https://www.grantthornton.co.nz/faqs-cryptopia-liquidation/

Cryptocurrency is considered "property" under NZ law rather than "currency" under Japanese law.


https://www.classic.ird.govt.nz/income-tax-individual/cryptocurrency-qa.html

[xtraelv]

Source: https://www.grantthornton.co.nz/update-for-cryptopia-account-holders-27-may-2019/

[xtraelv]

https://www.grantthornton.co.nz/update-for-cryptopia-account-holders-3-july-2019/

COMPANIES IN RECEIVERSHIP AND LIQUIDATION
Update for Cryptopia account holders 3 July 2019
03 Jul 2019
We understand that Cryptopia stakeholders are keen to hear what progress has been made on the liquidation process in the last few weeks. Please find below a summary of what the liquidators have been doing to secure and preserve the crypto-asset holdings for the benefit of those entitled to them.

Securing assets

We have undertaken a significant legal process to further secure the crypto-asset holdings. This is a very positive development.

We have obtained Chapter 15 Bankruptcy Recognition in the United States. Now that the Recognition Order has been entered, certain protections apply to Cryptopia and its property within the territorial jurisdiction of the United States. An “automatic stay” is effective and acts as a moratorium in favour of Cryptopia and its property within the territorial limits of the United States concerning pre-petition claims including litigation (whether class action or otherwise), creditor collection efforts with respect to Cryptopia’s assets in the United States, and efforts by contract counterparties to terminate contracts with Cryptopia.

A similar automatic stay against legal action is also in force under New Zealand insolvency law.

Determining customer holdings

These legal processes mean we have now recovered the customer holdings database from Phoenix. Initiatives are now underway to reconcile this with Cryptopia-controlled crypto-asset wallets. This is not a simple task as there are hundreds of thousands of customers and many hold multiple crypto-assets.

We have begun and continue the process of recovering certain wallets which were established after the January hack and moving them into a “safe non-hacked environment”. The requirement to undertake this task is also contributing to the complexity of the process.

We continue to liaise with our legal advisors to determine how crypto-assets could be returned to customers. However, due to the January hack, this is a complex and time-consuming process. For example, an Exchange that has been hacked cannot simply be reopened. We have certain legal requirements and obligations both in New Zealand and internationally that liquidators must meet, such as Anti Money Laundering/Know Your Client (AML/KYC) requirements when considering any repayment or return of assets.

We continue to liaise with the New Zealand Police and other authorities internationally in relation to the January hack and other issues arising in connection with customers’ use of the Exchange. 

Working through the legal process

International law governing crypto-assets is still very much in its infancy. Alongside our legal advisors we are looking to answer questions such as the legal status of crypto-assets, and the legal relationship between Cryptopia and its customers.

Where to go for updates

We appreciate that Cryptopia customers want to know where the process is at and what it means for them and understand the concern they feel. While we are working as fast as we can to resolve the situation as we do not have answers to many customer questions at this stage.

Given the volume of correspondence we regularly receive, we cannot reply to individual correspondence. However, we will continue to provide regular updates via the Cryptopia website, Twitter and Facebook pages.

We have today also updated the frequently asked questions to include answers to questions in relation to transaction listings and creditor claim forms

[xtraelv]

Cryptopia ruling has just been made in the high court. If you are an account holder I recommend following the Cryptopia twitter account.
https://twitter.com/Cryptopia_NZ/status/1247765372444409859

Since a ruling has been made regarding how the crypto funds are to be treated it is likely that they will announce a formal process that will need to be followed to claim back your crypto.