Its disappearance from social media, as well as an apparent site shutdown, triggered fears of an exit scam
Proponents of Bitcoin and other cryptocurrencies point to secure transactions as a potential benefit, but the reality is still quite fraught with risk for investors who trade on small exchanges, which experts warn can be non-secure or unreliable.
Case in point: a day after it announced a successful maintenance session and upgrade of its server, Canadian crypto exchange MapleChange announced via Twitter on Sunday that it had “sustained a hack.”
Moments later, a tweet followed announcing that a bug had allowed “some people” to withdraw “all the funds from [the] exchange.” It promised a “thorough investigation,” but added that no refunds would be possible as it was ongoing.
[MAPLECHANGE TWEET 1]
An hour afterward, the MapleChange Twitter account was gone, along with its accounts on Discord, Telegram, and Facebook. Its website also reportedly became inaccessible. Within 24 hours, several cryptocurrency news websites had picked up the story, noting that the signs pointed toward a textbook exit scam.
For ccn.com, the short time between the announcement of the bug and the total disappearance of the exchange and its social media accounts was a red flag. And nulltx.com noted that while MapleChange’s history goes back to the end of May, it saw minimal activity until last week, when Coingecko.com data showed daily volume reaching a high of just under US$70,000 and carried into US$30,000 averages for most of the week.
But on Monday, the MapleChange Twitter account was reactivated. A tweet from the exchange explained that it turned off its accounts to think through a solution.
[MAPLECHANGE TWEET 2]
The company went on to say that it cannot refund any bitcoins or litecoin funds, but will try its best to refund everything else. MapleChange, which was the primary source of trading for altcoins Conceal, Lumeno, and Blur Network, likely lost funds in the amount of US$3 million to US$5 million, according to nulltx.com. It also hosted exchange pairs for 21 other cryptocurrencies, though losses on those assets are likely minimal in comparison.
Citing Coindesk data, a Forbes report noted that the price of bitcoin did not move much on the news. MapleChange’s small size, many experts said, will likely mean that the damage is somewhat contained.
On Monday, the Competition Bureau of Canada warned consumers of the risks. While it acknowledged that there are legitimate reasons to invest in cryptocurrencies, the bureau urged Canadians to be wary of internet ads and websites promising high returns, as they could be hooks for bogus initial coin offerings, pyramid schemes, or fraudulent market manipulations.
