Crypto Exchange BitGrail Struggling To Refund Lost Nano Tokens

Italian BitGrail is the second cryptocurrency exchange to fold into the hands of hackers this year, losing $170 million worth of Nano tokens. The bad news for investors is that BitGrail may not be able to refund all the lost digital currency.

BitGrail released a statement late last week confirming that internal checks revealed fraudulent transactions that have led to the loss of $17 million in Nano tokens which was formerly called RaiBlocks. The company released a statement and clarified that other digital currencies on the exchange were not affected by the hacking but as part of their security measures, all transactions including withdrawals and deposits remain temporarily suspended.

The announcement of the lost Nano tokens came days after BitGrail owner Francesco Firano announced via Reddit that the Know Your Customer (KYC) policy will be implemented in the exchange. Additionally all investors and users in the exchange were only allowed to withdraw their assets in Bitcoin.

The new policy caused a backlash against the exchange, with some users already planning a class action lawsuit to combat the policy changes calling it an exit scam. The new withdrawal limit and verification policy also left many people sceptical since many users are still awaiting verifications since December, despite the promise that verifications will only take 24 hours.

Boxmining

The consecutive missteps of Firano ultimately led to the big announcement of the lost Nano tokens. According to the official statement of the Nano Core team, they have no visibility into or control over the Bitgrail organization and transactions, and that the cause of the loss stems from BitGrail’s software not Nano’s protocols.

In the statement, the Nano Core team said,

We had no knowledge of BitGrail’s insolvency prior to February 8 th . We now have sufficient reason to believe that Firano has been misleading the Nano Core Team and the community regarding the solvency of the BitGrail exchange for a significant period of time

The Nano team is now preparing information and materials for law enforcement to take over. Firano responded to the statement via Twitter, saying that the Nano development team does not want to collaborate with him. “Collaboration” was out of the option, according to the Nano team, after Firano suggested in a private e-mail to modify the ledger in order to cover his losses.

Before the BitGrail hacking, Tokyo-based Coincheck lost the biggest amount of cryptocurrency in January to hackers, amounting to $534 million in NEM tokens. But unlike Coincheck, who has promised to reimburse all of its 260,000 affected users, BitGrail is running from the responsibility. Firano said in a tweet

After reaching an all-time-high value of $36.60 in January 2, Nano has now plunged to $8.75.