Minor Crypto Exchange Pulls Off Exit Scam, Steals All User Funds

A small Canada-based crypto exchange called MapleChange has pulled off an exit scam, disappearing with user funds.

The disappearance of MapleChange with user funds has led experts in the sector to encourage crypto investors to prevent the utilization of minor exchanges with no reputation and cold wallets that accurately represent their holdings.

Absurdly, the exchange said that due to the hack, the exchange is not able to pay any user back and closed down all of its social media accounts.

"We have sustained a hack, and we are investigating the issue. Because we have no more funds to pay anyone back, the exchange has to close down unfortunately. This includes all of our social media."

As seen in previous security breaches of major exchanges like Bithumb in South Korea and Coincheck in Japan, in an event of a hack, exchanges cooperate with local financial authorities and government-backed intelligence agencies to investigate the hack and potentially recover the funds lost in the hack.

A small crypto exchange pulled off an exit scam, taking all customer funds.

Investors affected by the fraudulent operation formed a group called "Maplechang'ed," to disclose the identities of executive behind the exchange and locate the team responsible for the exit scam.

Changpeng Zhao, the CEO of Binance, the world's largest crypto exchange which recently expanded to Singapore to operate its second fiat-to-crypto trading platform, called for the ranking of exchanges by amount held in cold wallets, as it is not possible for exchanges to fake holdings in cold wallets.

Several exchanges in South Korea were hacked because the trading platforms allocated all of their resources in listing new tokens and building features without establishing necessary infrastructure and security measures to protect user funds.

For security and protection, it is of utmost importance for crypto investors to rely on established, reputable, transparent, and regulated cryptocurrency exchanges that have the capability of protecting user funds and compensate investors in an unfortunate event of a security breach.