Crypto exchange BitBNS admits to funds getting compromised in 2022, clarifies on alleged hack of $7.5 million

Crypto exchange BitBNS’ founder Gaurav Dahake on March 1, said that some part of the firm’s funds did get compromised on February 1, 2022 but it wasn’t an abnormal scenario. This comes hours after an independent crypto scam researcher, ZachXBT, tweeted that the cryptocurrency exchange was covering up a $7.5 million hack under the guise of system maintenance.

While sharing screenshots of BitBNS’ tweets from February 1, 2022, the researcher said, “Let’s call out the crypto exchange BitBNS for hiding a $7.5 million hack from their users on February 1, 2022 and then proceeding to tell them it was “system maintenance”.

Let’s call out the crypto exchange @bitbns for hiding a $7.5m hack from their users on February 1 2022 and then proceeding to tell them it was “system maintenance”

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0x24f361E1eeEdF29fd6D724C9393132D61c51ebB1 pic.twitter.com/a3aBqlgW0z

— ZachXBT (@zachxbt) February 28, 2023

Responding to the allegations Dahake, went live on YouTube, saying, “Most big exchanges saw such incidents. Binance had funds compromised. BitBNS too saw a small incident. Right before that incident, we had experienced irregular activities on the platform, that’s when we decided to take the exchange offline for a few minutes to analyse the issue.”

He added, “We found issues with specifically a few token prices, there was a difference in buying and selling prices. At that point in time, some users were trying to withdraw funds. We wanted to analyse the funds and found on one particular address, certain amount of funds went from different tokens and those got converted into Ethereum and went to different addresses.”

According to Dahake, this was not an abnormal activity. It had happened to multiple exchanges, multiple times across Binance, KuKoin, etc. “When a security issue like this comes up, you try to fix the checks and balances in place,” he said.

Dahake claims that his exchange is currently the only one in India that allows crypto withdrawals. Since February 2022, BitBNS has seen an unusually high volume of withdrawals. TDS and taxes on virtual digital assets were then implemented, followed by the Luna crash and the collapse of FTX.

“We survived all of that and worked seamlessly,” he said.