A PYMNTS Company

US FTC Probes $200M Bitmark Crypto Hack

 |  August 11, 2022

In what is its first investigation into cryptocurrency markets, the Federal Trade Commission (FTC) is looking into the Bitmark currency exchange over the December 2021 hack that cost consumers $200 million.

According to an FTC order filed Wednesday (Aug. 11), the agency denied a request by Bitmart operators Bachi.Tech Corp. and Spread Technologies LLC to quash the agency’s attempt to compel them to reveal information.

“The investigation includes inquiries about Bitmart’s representations concerning its advertised exchange services,” the FTC said in the document.

It adds that it is also probing whether “consumers have been denied access to their accounts” as well as “concerns about the security of customer accounts, especially in light of … 2021 security breach that resulted in consumer loss of more than $200 million in cryptocurrency.”

According to the document, Bachi and Spread argued that the FTC cannot compel Bachi.Tech to produce materials located in other countries, that the information it seeks is irrelevant and that its requests are too broad and would impose an undue burden.

Bitmart revealed the hack on Dec. 4 of last year. At the time, the company said $150 million in funds had been stolen, although cyber security experts later put the figure closer to the $200 million listed by the FTC.

This news comes three weeks after another first in the world of U.S. crypto enforcement. On July 21, the U.S. Department of Justice charged a former Coinbase manager and two other men in what it said was the first insider trading case involving cryptocurrency.

Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.