Gemini Sued by IRA Financial Over $36M Hack
Gemini allegedly never notified IRA of the security threat posed by the master key of their API.
Photo: Callaghan O’Hare/Bloomberg
Key Takeaways
- IRA Financial, a company that provides services for self-directed retirement and pension funds, is suing crypto exchange Gemini over its failure to prevent the hack of $36 million of IRA customer money in June.
- The lawsuit claims Gemini insisted for IRA to use a system that contained a single point of failure which cyber criminals from various illegitimate sites.
- Proceeds from the lawsuit will be used to reimburse IRA customers.
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Gemini is being sued for allegedly providing IRA Financial an onboarding system with a single point of failure, which allowed the theft of $36 million in IRA customer money. The exchange is also accused on failing to freeze accounts with sufficient rapidity.
Hack Was Possible Due To Single Point Of Failure
IRA Financial Trust (IRA) is suing Gemini over the February 2022 hack that saw $36 million of IRA customers’ money siphoned from the cryptocurrency exchange.
As stated in their press release, IRA, a U.S. platform for self-directed retirement and pension accounts, alleges in the lawsuit that Gemini “did not have proper safeguards in place to protect customer crypto assets” and “failed to freeze accounts within a sufficient [time-frame]” after IRA had alerted Gemini of the theft.
