As the first few weeks of 2021 have concluded, various firms in the crypto world have provided their communities with recaps of the previous year and have given briefs on what to expect moving forward. Few of these were as anticipated as that of KuCoin, the popular cryptocurrency exchange which suffered a security breach in September 2020.
The breach was no small one, as over $285 million was stolen from the exchange. Now, in an open letter to the community, Johnny Lyu, the CEO of KuCoin, has finally addressed the issue as well as what steps the exchange is taking.
The Root of the Matter
Lyu, in the letter, noted that crypto exchanges are always wary about their security protocols, calling them the ‘sword of Damocles’ that hangs over exchanges. He clarified that once the management became aware of the security breach, they took measures to protect both their partners and their customers. Deposits and withdrawals were resumed a week after the incident before all features were then restored.
Furthermore, a majority of the funds that were stolen have been recovered. KuCoin’s cooperation with other crypto exchanges led to the recovery of 78% of the missing funds and assistance from law enforcement also helped in the recovery of another 6%. Finally, KuCoin and its insurance fund covered the remaining 14%. This is significant because, in the past, it wasn’t usual for stolen crypto assets to be recovered at all.
It is also notable because KuCoin is quite an influential exchange and thus, the number of affected customers would have been tremendous if recovery had not been made. Lyu stated that KuCoin is working with the authorities and that intelligence has been gathered on the situation. In the letter, Lyu also noted a growth in KuCoin’s operations.
“In 2020, our margin trading volume increased 217% year on year and has supported 33 tokens and 54 trading pairs. Since the start of the year, KuCoin Futures have achieved a stunningly rapid 420% increase in trading volume and a remarkable 670% growth in user numbers. It now supports 17 coins, including USDT-Margined and Coin-Margined Contracts, and Perpetual Futures and Quarterly Delivery Futures,”.
KuCoin will, moving forward, support the Polkadot para chain slots auction, as well as new DeFi and NFT trading boards. Lyu stated that he expects bitcoin to surpass gold in the next few years and also has high hopes for the decentralized finance (DeFi) space.
Finally, KuCoin’s main focus for the next few years will be the decentralized space, KCS and finding new gems within the crypto ecosystem.
“In general, the future strategy of KuCoin will be carried out by two priorities: ‘Find the next crypto gem’ and ‘Empowering KCS’. In order to achieve the former, our intercontinental blockchain project research team will keep up with industry trends to identify more promising projects,” Lyu said.