Upbit no longer utilizing BitGo
Upbit, a domestic cryptocurrency exchange, is no longer utilizing BitGo, a digital asset storage operator. This happened after 342,000 etherum was moved to an anonymous wallet on Nov. 27. Upbit announced the hacking of the ethereum wallet when the incident happened. Before it happened, Upbit had been managing a hot wallet using BitGo’s multi-sig technology. "Withdrawn address difficult to be viewed on multi-sig" Multi-sig, or multi signature, requires at least two signatures for a transaction, offering higher security than single-signature transactions. Following the ethereum incident, there were doubts about the Upbit service itself, but questions also arose about BitGo, which provides custody for crypto assets. One of the reasons cryptocurrency exchanges keep a certain proportion of cryptocurrency in a hot wallet is due to liquidity problems resulting from security solutions like the multi-sig. But experts suggest the address of the 342,000 etheruem withdrawn can’t be viewed on the multi-sig wallet. “I can’t confirm because I’m not sure which part of BitGo Upbit uses, but the withdrawal address that is currently revealed can’t be seen on the multi-sig wallet,” said GrowFi CEO Park Kyung-Nam. “Ethereum doesn’t support multi-sig functions, but supports multi-sig that uses smart contracts.” Developer Shin Jin-hwan from Onther, which developed the Tokamak Network, said, “Ethereum is based on accounst, and therefore, have different fields when it comes to transactions. This allows only one person to sign. Bitcoin, on the other hand, uses a script signature for Unspent Transaction Output (UTXO). If UTXO is formed based on signatures from multiple people, multi-sig becomes feasible.” Follow-up measures to hacking? The dominant view of Bitgo’s update is viewed as a follow-up measure after the hacking. Technically, the hacking is because of Bitgo’s custody service. Despite the doubts about Upbit, Park said, “Upbit is feasible. Technically, it is possible for Upbit not to have known this fact for a while.” But Upbit might also be responsible. For cryptocurrency exchange to continue to exist amid doubts, it is of the utmost importance to recover consumer faith.