Bitget Hack Sparks Concerns About Centralised Exchange Security

Bitget's $351 million hack has revived a three-year-old warning from Hyperliquid founder Jeff Yan that Bitget may be the next FTX. However, while some analysts see an opportunity for decentralised exchanges (DEXs) to gain market share, others argue that this view is based on thin evidence and that the situation is more complex than it seems.

The hack occurred on September 24, when Bitget's security systems detected unauthorised transfers from some hot wallets. About $351.6 million was affected, but cold wallets remained secure, and withdrawals were paused pending a security review.

Bitget CEO Gracy Chen attributed the breach to a supply-chain attack, where a compromised third-party tool used daily by Bitget affected a core backend system for its wallet service. She ruled out private-key leaks and insider involvement, although some IP addresses linked to the attackers were found to be associated with a North Korean group.

The incident has sparked concerns about the security of centralised exchanges, but it's worth noting that Bitget's User Protection Fund holds over $464 million, which covers the full loss. This means that users are protected, and trading can continue uninterrupted.