Kronos Research reports loss of $26 Million due to security breach
Kronos Research, a significant market maker and venture capital fund, has reported a substantial outflow of cryptocurrency assets following a security breach involving unauthorized access to its API keys. A market maker is a company or individual that consistently offers to buy and sell securities to ensure market liquidity, which allows traders to execute orders promptly at stable prices. They profit from the spread between the bid (buy price) and ask (sell price).
The breach was publicly disclosed by Kronos Research on Twitter on Sunday, 19th of November, when the firm noticed irregular withdrawal activities.
The firm suspended of all trading to prioritize the investigation into the cyber intrusion. Kronos Research, while acknowledging the breach, sought to maintain transparency with stakeholders by revealing the incident and its implications. The loss, quantified at around $26 million worth of Ether coin, is significant but not detrimental to the firm's overall equity, as per their assessment.
Kronos Research have not disclosed details about how the API keys were exposed, but has assured that the financial burden of the loss will not be transferred to any of their partners, signaling an intention to absorb the losses internally.
The ripple effect of the security breach at Kronos extended to WOO X, a cryptocurrency exchange where Kronos plays a pivotal role as a market maker. WOO X responded to the incident by temporarily pausing trading activities to safeguard users from the consequences of diminished liquidity, which could potentially result from Kronos's operational halt.