Can we suffer at some exchange due to some of their services' breach?

[2double0]

After the recent FTX dilemma, we need to rethink on our decision to keep our funds at exchanges at all or not. All this has actually impacted the markets' trading volume a lot already, which shows that traders are not interesting in trading too much and they are taking out their money at non-custodial wallets. I came across a news that says:

'A third-party vendor linked to the Gemini cryptocurrency exchange has suffered a data breach. The breach happened on or before December 13. The hackers gained access to 5,701,649 lines of information associated with the Gemini exchange customers. The obtained details include the email addresses and some of the phone numbers of these customers.'

More available at source

This shows that sometimes, even not being guilty, the place where we put our trust and money may get compromised due to the services it is using or attached to, same as in this case where Gemini was not at fault but the third party vendor got hacked and there was a huge data breach of that exchange. Should we worry on every small aspect now that we know that these places are also vulnerable to get attacked not directly but indirectly through the services or various other departments they are involved with?

[mk4]

Should we worry on every small aspect now that we know that these places are also vulnerable to get attacked not directly but indirectly through the services or various other departments they are involved with?

It's not the first time an exchange(or an adjacent platform) got breached, so you should've been worried since the beginning. Only submit your personal information to a central service only when totally necessary. This applies to platforms inside and outside the cryptocurrency space.

https://cryptosec.info/exchange-hacks

[rat03gopoh]

Should we worry on every small aspect now that we know that these places are also vulnerable to get attacked not directly but indirectly through the services or various other departments they are involved with?

A data breach is not just a "small aspect", you using an exchange means you're giving up 2 valuable things for them to manage, your assets and personal information. The threat is clear from outsiders and sometimes insiders. Should you be worried? It also depends on your concern for the valuable things above.
Let's just say this concern is bound to happen given that no system is truly secure, it's only a matter of time. Use them when you really "have to", not just when you "can to".

[RapTarX]

Would you be worried about sharing your data with someone else or a 3rd party? I guess not when you are using CEX as it requires going through KYC. We don't know what they are doing with our data, do we? How do you know that Gemini didn't sell the database? When you are submitting your data to 3rd party, you are making a reason to be worried.

After the recent FTX dilemma, we need to rethink on our decision to keep our funds at exchanges at all or not.

This was always the same; why only after the FTX dilemma, we have to rethink? Having funds on a centralized exchange means you don't own the coins. It was/is/will be the same forever regardless of which exchange got hacked, or bankrupt.

[BitMaxz]

A data breach is common to any website not just on exchanges it's public and anyone can attempt to hack the website but we should not be the ones who suffer from their stupidity the exchange should be at fault for how they focus to protect customers' money from any attacks. They don't even hire someone to monitor their wallet 24/7 if there is one exchange staff monitoring the wallet they can easily make a double spend and send it back to the secured wallet.

And even our documents and sensitive information(excluding password) breached its just a data that hackers can use to other things but it won't help to hack the exchanges wallet.

[NotATether]

And even our documents and sensitive information(excluding password) breached its just a data that hackers can use to other things but it won't help to hack the exchanges wallet.

They won't use the data to target the exchange, they'll use it to target you. Average people have way less opsec than even the most corrupt and lax companies (like FTX for example). It is very easy to figure out what a person will do if you study their present interactions, something that corporate secrecy makes it harder to collect for business.

[Darker45]

This is just one among a number of reasons why keeping funds in a centralized exchange is not recommended. Different kinds of breach could come from anywhere. A hack in the exchange's hot wallet could happen anytime. Or the malicious intention could come from the inside itself. Users' funds could have been risked elsewhere and lost. And then there's also mismanagement. Or a trusted staff could have leaked vital information leading to a successful breach. Since there are also third parties involved, the attack or failure could also come from them. In other words, there are a hundred possible ways that a centralized exchange could collapse anytime.

[The Cryptovator]

Centralized means centralized, doesn't matter how good it is. Using centralized means we already compromised our privacy. Though sometimes we don't lose funds we have been losing our data during the data breach. Even top exchange Binance is not out of data breach. So day by day it's become impossible to trust any exchange whether with our funds or data. There is no solution except dex or swap where we can't find our desired coins sometimes.

[coin-investor]

Centralized means centralized, doesn't matter how good it is. Using centralized means we already compromised our privacy. Though sometimes we don't lose funds we have been losing our data during the data breach. Even top exchange Binance is not out of data breach. So day by day it's become impossible to trust any exchange whether with our funds or data. There is no solution except dex or swap where we can't find our desired coins sometimes.

Am I the only one wishing that the top exchanges in the industry are all DEX but is unlikely to happen because investors are into so many coins and the lack of liquidity makes them turn to centralized exchanges because these centralized exchanges are good at manipulating the price and adding liquidity to attract users to trade on their platform, we either choose DEX or there should be regulation that will monitor the behavior of these centralized exchanges.
A centralized exchange is a necessary evil in this industry whether we like it or not.

[Findingnemo]

After the recent FTX dilemma, we need to rethink on our decision to keep our funds at exchanges at all or not. All this has actually impacted the markets' trading volume a lot already, which shows that traders are not interesting in trading too much and they are taking out their money at non-custodial wallets. I came across a news that says:

'A third-party vendor linked to the Gemini cryptocurrency exchange has suffered a data breach. The breach happened on or before December 13. The hackers gained access to 5,701,649 lines of information associated with the Gemini exchange customers. The obtained details include the email addresses and some of the phone numbers of these customers.'

More available at source

This shows that sometimes, even not being guilty, the place where we put our trust and money may get compromised due to the services it is using or attached to, same as in this case where Gemini was not at fault but the third party vendor got hacked and there was a huge data breach of that exchange. Should we worry on every small aspect now that we know that these places are also vulnerable to get attacked not directly but indirectly through the services or various other departments they are involved with?

Data breaches are not high threat like security hack for an exchange but these datas are not really from exchange but from the third party which the exchange shares the data with. But are we really going to suffer due to this then the answer is not if you know what you're doing whether it comes to internet so you can get rid of phishing attacks and most commonly known threats. But one who really want their privacy at top priority should never ever disclose any personal data to others even its highly popular and trusted exchange.

[Husires]

If lawsuits are submitted to all platforms that neglect user data or a harm from the causes that will happen, these platforms will be spent more effort in protecting the evidence and sharing them with third parties, but the conditions of the service make them very lazy to control these data.
if you are from a country that is difficult to file a lawsuit, it is better to consider that any data you send to a platform has already been hacked.

[sheenshane]

Should we worry on every small aspect now that we know that these places are also vulnerable to get attacked not directly but indirectly through the services or various other departments they are involved with?

I think this isn't a small aspect to be worried about, it's a serious topic that could have consequences putting our data at risk when picking the wrong exchange that easily got hacked or when has a security breach.  From the start, we should know this possible outcome, that's why picking a centralized exchange where we entrust our data is quite tricky, or just never using them if this is what you are worried about.  Just accept the fact that it's always vulnerable to hacking all of CEX's platforms even though how tight they're when it comes to their security measures.

Centralized means centralized, doesn't matter how good it is. Using centralized means we already compromised our privacy. Though sometimes we don't lose funds we have been losing our data during the data breach. Even top exchange Binance is not out of data breach. So day by day it's become impossible to trust any exchange whether with our funds or data. There is no solution except dex or swap where we can't find our desired coins sometimes.

I tend to agree with this, quite simply but yet that's the fact.

[Z-tight]

If lawsuits are submitted to all platforms that neglect user data or a harm from the causes that will happen, these platforms will be spent more effort in protecting the evidence and sharing them with third parties, but the conditions of the service make them very lazy to control these data. if you are from a country that is difficult to file a lawsuit, it is better to consider that any data you send to a platform has already been hacked.

Their terms of service may assure you that your data would be protected and won't be shared with any third party, but centralized exchanges are known to sell their users data or give it to blockchain analysis companies; the government have also regulated exchanges to the point that they can request for information about their users and get it, so what is the point of filing a lawsuit if they get hacked and your data is exposed, it won't yield a thing, because your data was exposed the moment you registered. The exchange would even exempt themselves from any wrongdoing because it was a breach of their system that was beyond their control.

If an exchange platform files for bankruptcy, information about the exchange is made public to the court, some of these information includes users private data, it happened when Celsius filed for bankrptcy some months ago, that is the extent to which centralized exchanges carry a privacy risk, because there are many ways your data can be exposed to the public.

[Accardo]

It is bitter that the traditional finance system permeated the cryptocurrency peer 2 peer trading system through centralized exchanges. I'm a victim, they've got my identity cards, who knows the hacking group in possession of my photos. It's quite too risky, to expose millions of customer's KYC to criminals. Their database is not secure and can easily get accessed once the exchange is hacked. I don't see any difference, CEX is 100 percent operating like the banks. We should worry more about CEX than getting rid of the banking system.

[sunsilk]

Aside from being affected with users fund, what's more worrisome are those information that has been obatained by the hackers.

They have it permanently and can access or sell it to the dark market or any company that has interest on those information.

That is why if it includes our email, we are receiving unwanted emails and phishing email attempts.

[Fiatless]

Aside from being affected with users fund, what's more worrisome are those information that has been obatained by the hackers.

They have it permanently and can access or sell it to the dark market or any company that has interest on those information.

That is why if it includes our email, we are receiving unwanted emails and phishing email attempts.

This hacked information would be used to hack or attack the accounts of customers. Sometimes most exchanges would keep information about an attack on their platform secret because they don't want to lose clients' trust and confidence. Meanwhile, the best they would have done was to notify customers so that they can change their passwords or carry out other security measures. The best option remains that we should only put funds that we can afford to lose in exchange and personal information should to a large extent remain private.

[rat03gopoh]

Recently I thought that regulations are only made oriented towards user activities: KYC, suspension of account/assets, and restricted countries. Based on the FTX case, I wonder whether regulations also have specific rules regarding the activities of the exchange itself, such as the obligation to report balance sheets, liquidity, company performance, and actively monitor their team and partners intelligently?

It is very surprising if the shady operation carried out by the SBF was revealed precisely thanks to non-legal authorities.

[Adbitco]

As a member over here in the forum i believed you should get used to it and know how to safeguard your information and personal data or details most especially not leaving your funds on a centralized exchangers because its not secured and safe for one to leave their money, the best is to always look for a reliable wallet where you could  have all phrase and private key kept on your custody than just leaving your funds over in any exchanger.
What i always said is that as a smart user over here, if you are not trading or converting your to fiat or from fiat to cryptocurrency don't leave your funds on exchange. It's always says "Not your key not your money". Keep in mind that FTX and many other security breaching today are not just emanating recently so apply wisdom and know where to keep your funds.

[sunsilk]

Aside from being affected with users fund, what's more worrisome are those information that has been obatained by the hackers.

They have it permanently and can access or sell it to the dark market or any company that has interest on those information.

That is why if it includes our email, we are receiving unwanted emails and phishing email attempts.

This hacked information would be used to hack or attack the accounts of customers. Sometimes most exchanges would keep information about an attack on their platform secret because they don't want to lose clients' trust and confidence. Meanwhile, the best they would have done was to notify customers so that they can change their passwords or carry out other security measures. The best option remains that we should only put funds that we can afford to lose in exchange and personal information should to a large extent remain private.

That is for sure, when they've been attacked and there's a breach, there's the chance that they don't really want to inform their community and users because that will create a ruckus.

And that's what they don't want to happen and now with Binance, they've seen how wise people are these days. There will be a huge outflow of withdrawals whenever there's a bad news about an existing exchange.

[Woodie]

After the recent FTX dilemma, we need to rethink on our decision to keep our funds at exchanges at all or not. All this has actually impacted the markets' trading volume a lot already

Trading has taken a tumble after several of such incidences and the only way to win traders back will be through guarantees of funds being 100% protected through insurance or something....otherwise trading volumes will remain flat for a while.

This shows that sometimes, even not being guilty, the place where we put our trust and money may get compromised due to the services it is using or attached to, same as in this case where Gemini was not at fault but the third party vendor got hacked and there was a huge data breach of that exchange.

It's time such entities showed capacity to handle such sensitive user data or better yet find a way to scrap out KYC to reduce their on their responsibilities.

Should we worry on every small aspect now that we know that these places are also vulnerable to get attacked not directly but indirectly through the services or various other departments they are involved with?

We definitely have to take an interest in such more especially the data affected is about us, maybe legal action is the way to go for now.