Flexcoin, a Bitcoin bank, is forced to close after theft of 896 Bitcoins

bitcoin march 4

Flexcoin, which was a bank for Bitcoins, has been forced to close after 896 of its Bitcoins, or $597,300 USD, at the time of this article’s writing, were stolen.

This marks yet another blow to those who have legitimate businesses based around Bitcoin and because of it Flexcoin has shut down operations and their website, only posting a statement informing people of the current circumstances. They will also be releasing updates through their Twitter account.

“On March 2nd 2014 Flexcoin was attacked and robbed of all coins in the hot wallet,” said the statement. “As Flexcoin does not have the resources, assets, or otherwise to come back from this loss, we are closing our doors immediately.”

Luckily for those who had their coins stored with Flexcoin in cold storage, those are still safe and are being transferred to their owners.

“Users who put their coins into cold storage will be contacted by Flexcoin and asked to verify their identity,” the statement also said. “Once identified, cold storage coins will be transferred out free of charge. Cold storage coins were held offline and not within reach of the attacker. Flexcoin will attempt to work with law enforcement to trace the source of the hack.”

Along with the recent closure of Mt.Gox due to stolen Bitcoins, Poloniex, another Bitcoin exchange, announced that 12.3% of their reserves had been taken by hackers.

“I sincerely apologize for this,” Poloniex’s owner said in a statement, “and I am very grateful to the many people who have already expressed their support and belief in my character. I take full responsibility; I will be donating some of my own money, and I will not be taking profit before the debt is paid.”

All these incidents continue to point to the dangers associated with using a currency that is as unstable as Bitcoin is.

[via The Guardian, image via antanacoins’ flickr]

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