Incodium’s R&D Manager, Gilbert Talom, Reveals The Deeper Cost of Cryptocurrency Exchange Hacking
There have been a fair amount of hacking incidents on cryptocurrency exchanges this year. It is estimated that exchanges have lost close to USD 1.7 billion to hackers, inflicting severe damages on the cryptocurrency market as a whole. The media and social networking sites have rolled out thousands of articles, videos, and news pieces to explain the effect of hacking on the cryptocurrency market and the economy in general. There has however been very little attention on the common man, the student, the family head, the bus driver, the journalist, or the job applicant whose investment is lost in an exchange hacking incident. Come to think of it, these people are not only the raison d’être but also the real drivers of the cryptocurrency revolution.
With hundreds of ‘disruptive’ projects in an otherwise well established financial sector, blockchain and cryptocurrency projects seek to revolutionize service provision in what has come to be described as the ‘sharing’ economy. Transfer of funds, cloud services, rental businesses, real estate, maritime transportation, flight, gaming, and gambling are a few of the sectors that have been the focus of cryptocurrency projects. The ideas behind these projects, the unprecedented successes of pioneering projects like Bitcoin and Ripple, and more importantly, the ‘ease of entry’ into cryptocurrency trading has encouraged individuals of all works of life, social backgrounds, and ages to invest in cryptocurrency project.
While it is common knowledge that all investments have risks, investors can tolerate volatility in the prices or value of cryptocurrency. They are however unprepared when faced with the possibility (or reality) of losing all or a substantial part of their investment in an exchange hacking incident.
While the substantial part of the USD 1.7 Billion lost in exchange hacking belongs to large and institutional investors, there is no doubt that people with little means have lost their life savings and sometimes livelihoods in exchange hacking. Losses of this nature often have devastating consequences on personal and business relationships, educational standing, mean of sustenance and may lead to life-threatening situations. Friends and relatives have been brave enough to talk about losing their coins in exchange hacking and the effect that has had on their health, mental state and relationships.
Exchange hacking incidents can also trigger massive falls in the value of cryptocurrencies and associated losses. These losses are not limited to financial stability and means of sustenance as we mentioned above but also lead to the loss of life. A South Korean student was found dead earlier this year after losing a lot of money in the cryptocurrency market. Other losses to hacking incidents have been of a personal nature, especially through the use of cell phone lines. These incidents pose a serious threat to the cryptocurrency market.
It’s not all doom and gloom for victims of exchange hacking. The introduction of the Incodium Project is a welcomed addition to the cryptocurrency market. Incodium will safeguard investments and offer even more value on the crypto platform. Incodium provides compensation for investors who are victims of exchange hacking damages. Eligible investors (those holding Incodium coin or INCO in their smart wallets) are compensated using a number of criteria with amounts up to USD 10 000 in some cases. The project not only provides a ‘soft landing’ for investors but a platform to generate even more value for investors who choose to participate in data sharing, crowdfunding and the payment platforms.
Considering the potential and popularity of the cryptocurrency market, Incodium is certainly a worthy companion for both investors and exchanges. One can only hope that an effective, fast and transparent project like Incodium succeeds.
