Tallinn, 26 July 2023
On July 22nd, CoinsPaid experienced a hacker attack, resulting in the theft of USD 37.3M. We suspect Lazarus Group, one of the most powerful hacker organizations, is responsible. Besides your favorite crypto payment processor, Its list of victims also includes the world’s top companies: Sony (USD 81M), Axie Infinity (USD 625M), Horizon Bridge (USD 100M), Atomic Wallet (USD 100M) and Alphapo (USD 23M). But first, let’s learn more about how crypto payments work.
How Crypto Payments Work and How They Can Be Hacked
Crypto payments work through a decentralized network of blockchain technology, which records and verifies transactions securely and transparently. When a customer initiates crypto payments, the transaction details are broadcasted to the network, where they are validated by network nodes through a process called mining. Once validated, the transaction is added to a block and appended to the blockchain. This process ensures the integrity and immutability of the transaction, making it tamper-proof and resistant to fraud.
Merchants can then access these transactions through their crypto payment gateway, where they are converted into fiat currency or held as cryptocurrency, depending on the merchant’s preference. Overall, crypto payments offer fast, borderless, and secure transactions, revolutionizing the way we exchange value in the digital age.
What is a Crypto Payment Gateway and How It Can Be Hacked?
A crypto payment gateway functions as a conduit between traditional financial systems and cryptocurrencies, facilitating the seamless exchange of digital assets for goods and services. Essentially, it acts as an intermediary that enables merchants to accept crypto payments in various cryptocurrencies, including Bitcoin, Ethereum, and others, while allowing customers to make purchases using their preferred digital currencies.
These gateways typically have integration with e-commerce platforms, enabling merchants to expand their payment options and tap into the growing market of crypto payments. By providing secure and efficient transaction processing services, a crypto payment gateway plays a crucial role in driving the adoption of cryptocurrencies in mainstream commerce.
We believe Lazarus expected the attack on our cryptocurrency payment gateway to be much more successful. In response to the attack, CoinsPaid’s dedicated team of experts has worked tirelessly to fortify all the systems and minimize the impact, leaving Lazarus with a record-low reward. Indeed, our security measures and procedures allowed CoinsPaid to prevent higher loss of funds.
Benefits of Crypto Payment Gateway
A crypto payment gateway offers a multitude of benefits for both merchants and customers alike. For merchants, these gateways provide a seamless and efficient way to accept crypto payments, expanding their customer base to include crypto enthusiasts worldwide. Additionally, a crypto payment gateway often has lower transaction fees compared to traditional payment processors, saving merchants money on each transaction.
For customers, companies that accept crypto payments offer greater privacy and security, as transactions are encrypted and decentralized, reducing the risk of fraud and identity theft. Moreover, crypto payments are faster and more convenient than traditional payment methods, enabling users to complete transactions quickly and easily from anywhere in the world.
As a user-driven crypto payment processor, the number-one priority, we ensured that customer funds stayed intact. Unfortunately, the attack influenced our platform’s availability, the favorite payment method was not available, and the company’s revenue was also impacted.
“After the partial downtime, our services are getting up and running one by one in the new secured environment. We expect it to take a few more days to sort out minor details and ensure the system works smoothly”, underlines Max Krupyshev, CoinsPaid CEO.
Bitcoin & Crypto Payments Checkout: Preventing Hacks
CoinsPaid crypto payment gateway immediately initiated an investigation to track and mark stolen funds via various blockchain analytics tools. As a consumer-centric crypto payment gateway and active part of the community, we sincerely thank all users and enthusiasts for being considerate and proactive. Companies such as Crystal, Chainalysis, Match Systems, Valkyrieinvest, Staked.us, OKCoinJapan, Binance, and many more are aiding us with the investigation.
“CoinsPaid will recover and continue delivering first-class innovative payment solutions despite the incident. We have no doubt the hackers won’t escape justice”, added Max Krupyshev.
It is worth mentioning that crypto payment processor CoinsPaid also filed an official report with the Estonian law enforcement agency on July 25th and is committed to cooperating with the investigation process. As the world strives for trust, transparency, and reliability in the financial system, such incidents make each сrypto payment gateway even more secure. They enable the whole crypto industry to become more stable and efficient in terms of crypto payments.
Within a few weeks, CoinsPaid will organize a round table with all the Lazarus victims to announce a new initiative aimed at minimizing and preventing such attacks in the future. We urge Binance, Kraken, Coinbase, Bitfinex, OKX, and other сrypto payment gateways and companies that accept crypto payments to participate in this vital process.
It should be mentioned that amidst the challenges with crypto payments, including security concerns, the world accepting digital currencies emerges as a beacon of hope for the industry. CoinsPaid continues its commitment to enabling businesses to accept crypto payments seamlessly. For commerce platforms, it is huge that modern global payment gateways offer a possibility of a real time transaction.
In a world transitioning from traditional fiat currencies, crypto transactions showcase adaptability and inclusivity, besides being a much faster and safer option than credit card payments. As payment gateways typically play a crucial role in ensuring secure and efficient transactions, the recent security breach has reinforced the importance of robust payment processing systems of the future.
What are CoinsPaid Crypto Payment Gateway Features?
CoinsPaid, as a leading entity in the crypto payment processing arena, enables merchants to accept cryptocurrency payments securely. One notable feature of CoinsPaid is its facilitation of payments for goods and services through a business crypto wallet. The concept is similar to everyday crypto wallets that allow users transactions from peer to peer using wallet addresses or a QR code option. Another useful solution for crypto is payment via invoice. CoinsPaid facilitates seamless crypto payments by offering clients the flexibility to export an invoice and choose their preferred payment method.
CoinsPaid’s dedication to maintaining the integrity of the crypto industry highlights the need for continuous collaboration and innovation within the sector. The unfortunate incident has spurred us to enhance its security measures further, and the upcoming round table with industry leaders aims to forge a united front against such threats. The commitment to enable businesses to accept cryptocurrency payments remains unwavering, contributing to the resilience and growth of the crypto payment ecosystem.
How to Accept Crypto Payments with CoinsPaid Securely and Avoid Hacks
Amidst the aftermath of the cyber breach, CoinsPaid doubled down on the commitment to fortify its crypto payment infrastructure. In view of the necessity of enhancing security protocols, the company swiftly performed the integration of advanced encryption layers in a crypto payment gateway. This move in conjunction with many other precautions aimed to bolster the resilience of its system for crypto payments against future threats.
CoinsPaid aims to restore trust among its user base and the wider cryptocurrency community, fortifying its payment infrastructure with cutting-edge security features. Additionally, CoinsPaid audited the system of a multifactor authentication API, ensuring that all transactions undergo rigorous verification processes.
Moreover, as part of its comprehensive security overhaul, CoinsPaid payment service collaborated with renowned crypto payment providers to develop new data security strategies to make the entire cryptocurrency payment processing ecosystem safer.
Furthermore, leveraging its expertise in transaction processing, CoinsPaid introduced innovative solutions to detect and proactively prevent fraudulent activities. Through real-time monitoring and anomaly detection algorithms, the company aimed to safeguard against potential threats and ensure the seamless operation crypto payments platform.
How To Choose the Best Cryptocurrency Payment Gateway to Prevent Hacks
When choosing the best crypto payment gateway, consider the following factors to avoid unnecessary chargebacks during crypto payments:
- Security Features
Prioritize gateways with robust encryption of crypto payments and compliance measures to protect transactions and sensitive data.
- Supported Cryptocurrencies and Fiat Currencies
Ensure compatibility with your business needs and target market by selecting a crypto payment gateway that supports crypto payments and fiat currencies you require, not just Bitcoin, Ethereum, or popular stablecoins.
- Transaction Fees and Pricing Structure
Evaluate the gateway’s fee structure to find a transparent and cost-effective solution that aligns with the budget and transaction volume of your crypto payments.
- User Experience
Opt for a crypto gateway with intuitive integration options and a user-friendly interface to enhance the crypto payments for both you and your customers.
- Customer Support
Look for a crypto payment gateway provider that offers responsive customer support to address any issues promptly and ensure a smooth experience with crypto payments.
In conclusion, the cyber breach served as a catalyst for CoinsPaid to reinforce its position as a leader in the decentralised payment industry. By embracing innovation, collaboration, and stringent security measures, CoinsPaid remains dedicated to shaping a more resilient and secure digital currencies payment for the future.
How to Secure Your Crypto Payment Gateway from Hackers
Securing a crypto payment gateway from hackers involves a multi-layered approach, combining advanced technology with best practices in cybersecurity. Here are some essential strategies:
- Implement Multi-Factor Authentication (MFA): Requiring multiple forms of verification, such as a password and a one-time code sent to a mobile device, adds an extra layer of security. This makes it more difficult for unauthorized users to gain access even if they have obtained login credentials.
- Regular Security Audits: Conduct frequent security audits and penetration testing to identify and fix vulnerabilities. Third-party security experts can provide an unbiased assessment of your gateway’s defenses.
- Encryption Protocols: Use robust encryption methods to protect data during transmission and storage. This ensures that even if data is intercepted, it remains unreadable to unauthorized parties.
- Smart Contract Audits: If your payment gateway utilizes smart contracts, ensure they are thoroughly audited for vulnerabilities. Engaging with specialized firms that conduct comprehensive smart contract audits can prevent exploits.
- Network Segmentation: Isolate critical components of your payment gateway infrastructure. By segmenting networks, you limit the potential damage a hacker can cause if they gain access to one part of your system.
- DDoS Protection: Distributed Denial of Service (DDoS) attacks can overwhelm your gateway, causing it to crash. Implementing DDoS protection services can help mitigate these attacks and ensure your service remains operational.
Best Practices for Users to Avoid Crypto Payment Gateway Hacks
Users play a crucial role in maintaining the security of crypto payment gateways. By following these best practices, users can significantly reduce the risk of falling victim to hacks:
- Use Strong, Unique Passwords: Create complex passwords that are difficult to guess and use different passwords for each account. Password managers can help generate and store secure passwords.
- Enable Multi-Factor Authentication (MFA): Whenever possible, enable MFA on your accounts. This adds an extra step in the login process, making it harder for attackers to gain access even if they have your password.
- Be Wary of Phishing Attempts: Always double-check the authenticity of emails, messages, and websites. Never click on suspicious links or provide personal information unless you are sure of the source.
- Keep Software Updated: Regularly update your software, including wallets, browsers, and operating systems. Updates often include patches for security vulnerabilities that hackers can exploit.
- Secure Your Devices: Use antivirus programs and firewalls to protect your devices from malware. Ensure that all devices used for accessing crypto payment gateways are secured against threats.
- Monitor Account Activity: Regularly review your account statements and transaction history. Report any suspicious activity immediately to the service provider to prevent further unauthorized actions.
By adhering to these practices, users can contribute to the overall security of crypto payment gateways, protecting their assets and ensuring the integrity of their transactions.
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