Swiss-Based Trade.IO Exchange Loses 50 million TIO Tokens

Trade.IO, a Swiss-based exchange, has seen 50 million TIO tokens kidnapped from one of its cold wallets. The exchange has issued a warning to freeze the trading of its native tokens on other exchanges:

https://twitter.com/TradeToken/status/1053967427732729856

The hack is rather mysterious, given that the TIO balances were held within a cold storage wallet, protected in a vault. As the Trade.IO team explained in a blog:

“We use industry recommended cold storage which are maintained in safety deposit boxes in banks, along with all corresponding materials. We have confirmed that the safety deposit boxes were not compromised.”

The hack was noticed late on Sunday, and by Monday, 50 million tokens worth as much as $7.5 million were moved. Immediately, the stolen tokens were sent to exchanges, with estimations of 200 to 400,000 tokens sold on both Bancor and KuCoin.

The Trade.IO team has decided to roll back the transaction record, warning users to stop trading, as the new balances would not be recognized after a hard fork. After the news of the hack and the subsequent selling of stolen tokens, the TIO market price slid from around $0.25 down to $0.15, before trading was suspended.

Trade.IO held its ICO in January 2018, and gathered around $31 million in Ethereum, while aiming for $135 million. The platform was an early adopter of the trend for tokenizing real-world assets. The TIO token is used for creating liquidity and democratizing the trading of securities and other assets.

Unfortunately, the bear market has wiped out the value of TIO, making for a negative return in dollar, Bitcoin and Ethereum terms. TIO has fallen to just 14% of its dollar value since the ICO.

The project has not yet shared the details of the hard fork, as it is apparently still thinking of the best approach to erase the token history of the hack. The TIO tokens, however, will not be centrally controlled, and cannot be frozen or re-issued, unlike previous cases such as KickCoin and Bancor (BNT) tokens, which were centrally locked and redistributed.