Bitcoin price falls 10% following hack on exchange

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A university student, a member of a club studying cryptocurrencies, attends a meeting at a university in Seoul on Dec 20, 2017. Korea's Yonhap estimated that a total of 40 billion won ($37.2 million) of coins went missing.

The news sent cryptocurrencies tumbling, with bitcoin losing about 13 per cent, ethereum down 12 per cent and ripple nearly 20 per cent lower as traders fret over the safety of their investments.

South Korean cryptocurrency exchange Coinrail said it was hacked over the weekend, prompting an extended sell-off of bitcoin to a 2-month low amid growing concerns about security at small- to mid-sized virtual currency exchanges. In addition to bitcoin, other major cryptocurrencies fell in price after the attack, including ethereum and ripple.

In 2014, Tokyo-based Mt Gox, which once handled 80% of the world's bitcoin trades, filed for bankruptcy after losing bitcoins worth around half a billion dollars.

There were numerous hacker attacks on cryptocurrency exchanges throughout the past year.

The venues have come under growing scrutiny in South Korea, the USA and other large economies in recent months amid a range of issues including thefts, market manipulation and money laundering. While the latest hacking target - a South Korean venue called Coinrail - is much smaller, the news triggered knee-jerk selling by investors, according to Stephen Innes, head of Asia Pacific trading at Oanda Corp.in Singapore.

The remaining coins within Coinrail seem to have been secured by Coinrail through the migration of assets onto cold storage wallets.

"Coinrail, as of June this year, hasn't been certified with the ISMS, as it isn't mandatory (for the organisation to do so)", the local regulator said in a statement.

Coinrail said in a statement on its website that it's reviewing its system due to hacking attempts. "The company wasn't immediately available for further comments".

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