Liquidators called in to hacked cryptocurrency business

The Christchurch-based cryptocurrency exchange that was hacked earlier this year has been placed in liquidation.

Liquidators David Ruscoe and Russell Moore from Grant Thornton have been appointed to wind up Cryptopia's affairs, which they said would take some months.

Police began investigating the hack in January, after the company disclosed it had lost "significant amounts" in a "security breach".

Liquidators said the hack hurt Cryptopia's finances.

"The highly publicised hack of Cryptopia's exchange in January 2019 had a severe impact on the company's trade.

"Despite the efforts of management to reduce cost and return the business to profitability, it was decided the appointment of liquidators was in the best interests of customers, staff and other stakeholders."

The liquidators were working with authorities and would contact Cryptopia customers over the coming days, they said.

"We realise Cryptopia's customers will want to have this matter resolved as soon as possible."

Police said they were still investigating the hack that occurred in January and stole "significant amounts" of money.

It had not yet disclosed how much money hackers stole from Cryptopia accounts.

Crypto-trader Ross Carter-Brown had an account with Cryptopia holding a few thousand dollars.

He said Cryptopia wiped 12 percent of funds from all accounts, to cover the cost of remedying the hack, with the intention of paying it back.

"That's the trim that I took even though the tokens I was holding weren't the ones taken, or stolen.

"I guess they were going to announce at a later date how they intended to settle that I owe you, which is now very much in question."

Cryptopia had 100 staff at its peak and was the only trader of obscure, niche crypto-currencies in New Zealand, he said.

Customers moving permanently to international exchanges to trade such crypto-currencies would have caused the failure of Cryptopia, he said.

"That's probably what has sunk them and obviously the reputational damage that goes along with an event like this [the hack]."

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