- The CEO of the Zimbabwean cryptocurrency exchange Golix claims that he lost the password for the Bitcoin cold wallet.
- The trading volume of the exchange is considered low, but the damage to people is still great.
The storage of Bitcoin and other cryptocurrencies is a delicate matter. Especially when it comes to large sums in the millions. The safest option is to store the cryptocurrencies on cold wallets, as no hacker or phishing attack can steal the private keys and thus gain access to the cold wallet.
CEO of exchange Golix loses password to BTC Cold Wallet
According to the online magazine iharare.com, Twanda Kembo, founder and CEO of the Zimbabwe based crypto currency exchange Golix, lost the password to the Bitcoin Cold Wallet in May last year. The accuracy of the information is confirmed by two sources familiar with the matter.
The Golix stock exchange can be classified as very small compared to the world-renowned exchanges such as Binance or Coinbase. There are 33 Bitcoins on the Cold Wallet, which currently have an approximate value of more than 300,000 USD. However, Zimbabwe has different income and living conditions, so each Bitcoin unit can be vital to the people there.
Zimbabwe’s central bank had previously clearly ordered the exchange to cease operations. The reason for this is a violation of regulatory aspects, although further details are not yet known. The stock exchange is said not to have made any more withdrawals, so some users complained loudly. However, Kembo himself denies any accusations:
Finally, I read most of the articles about us this last week and I noticed from some of the issues that some customers still had some issues with their accounts. I’ll be working on the support desk myself next week if you’re reading this and one of the people with account or transaction issues, please just write an email to email@example.com and put my name in the subject.
The situation seems to have cleared up for the time being, but this is a nightmare for every Bitcoin investor.
Keeping Bitcoin safe
There are many known hacks from cryptocurrency exchanges where Bitcoins worth several million USD could be stolen. The best known hack comes from the former Japanese exchange Mt Gox. More than 350,000 Bitcoins were stolen in 2014. As we have already reported, the legal proceedings are still ongoing today.
The safest option is to store Bitcoins on a cold wallet. The easiest way for private investors to do this is to purchase a hardware wallet. Larger stock exchanges use security technologies from the French security company Ledger or their own custody solutions, which are additionally secured.