The battle between Hacken, a cybersecurity and consultation firm and ExMarkets crypto exchange rages on a month following Coinmarketcap’s disclaimer on the latter’s page. The crypto exchange has finally shared its version of the story – uncovering “fraudulent behavior” in Hacken’s business operations and assets reporting.
In this article, we objectively look at how the story developed in the past year or so – the partnerships, disclaimers by CMC, tweets sent, and ExMarket’s latest revelation on Hacken’s operations. Both teams are yet to respond to our questions, hence this is our full report on what transpired between the cybersecurity firm and the crypto exchange.
Hacken.io blasts ExMarkets’ claims
A tweet sent out by Hacken Club, one of the many subsidiaries under Hacken.io, on Aug. 14 reported ExMarkets exchange on falsifying them as their audit partners on Coinmarketcap. The hash tweet sent out further offered a disclaimer warning traders to “think twice when using exchange who’s practices is public fraudulent data submission.”
Hacken has never worked with @ex_markets @CoinMarketCap please consider this submission as a fraudulent activity from exchange representatives.
Everyone should think twice when using exchange who’s practices is public fraudulent data submission pic.twitter.com/KRrSBe4RTi
— Hacken Club (@hackenclub) August 14, 2020
The consultancy team further asked Coinmarketcap to consider the action as “fraudulent activity” on the part of ExMarkets. The data aggregation platform has since placed a disclaimer on ExMarkets’ page claiming the exchange made a “public misrepresentation” on their audit team.
Coinmarketcap’s disclaimer on ExMarkets’ “public misrepresentation” of Hacken as their audit partner (Image: CMC)
However, the Lithuanian exchange has hit back on the claims stating it was an honest mistake on their part. Additionally, its quest to fully dig up the truth on where it went wrong, the exchange uncovered traces of fraudulent behavior in the ‘reputable cybersecurity service provider’.
An honest mistake?
According to the statement published by ExMarkets, the team first met with Hacken’s CEO and managing partner, Dyma Budorin, in Ukraine, Kyiv to hire the cybersecurity team as an audit partner. The meeting was held in Hacken’s registered offices at Parus Business Center in Kyiv in July 2019. However, the ExMarkets team claims that the Hacken offices had very few employees then – despite it being the pre-COVID era.
The lack of employees and empty Hacken offices raised some doubt about the cybersecurity firm but the ExMarkets executives rode along. First mistake.
Now enter Coinmarketcap
At around the same time, the ExMarkets team says it was pushing for its listing on Coinmarketcap. Following the fishy meeting with Hacken, ExMarkets decided to name the cybersecurity firm as an audit partner in its applications to CMC despite them not officially having a partnership. Mistake number two.
They preemptively called Hacken to inform them of the decision to list the as audit partners but received no response then.
A couple of weeks passed before Hacken’s team finally got in touch with the ExMarkets team. The crypto exchange’s statement claims Hacken came back asking for a 400% increase in their auditing service fees – a factor that made the deal fall through as it was “simply unreasonable”.
“In retrospect, we were too impatient, too eager — and, perhaps, too naive to include Hacken in our application form, thinking that everything would work out just fine. With no intention to deceive, we have, nevertheless, made a terrible oversight,” ExMarkets’ statement reads.
Following its listing in October 2019, the exchange claims it kept on trying to reach CMC to clarify their position but to no avail. Questions sent to CMC regarding the issue are yet to be answered.
Then the August 14th tweet from Hacken appeared.
Discovery of fraudulent behavior?
Following Hacken’s tweet on 14th Aug, the ExMarket team states it tried to reach Hacken through emails, social pages, and calls to solve the misunderstanding. However, no response was received from the cybersecurity firm – hence ExMarkets’ motive to physically visit the company’s offices.
According to Hacken.io, the head office is registered in Estonia at Kai tn 1-5M, Tallinn 10111 while the research and development office is at the Creative States, Moskovska vul 8, Kyiv 01029, Ukraine.
Hacken.io office locations
A product under Hacken, Hackenproof, gives different locations of their offices – HQ at Parda 4, Kesklinn, Tallinn, 10151 Harju Maakond, Eesti, Kesklinna, Estonia and the R&D team is situated in Mechnikova 2a, Business center “Parus” Kyiv, Ukraine, 02000.
Hacken’s product, HackenProof’s office locations
Diligently, the ExMarkets team visited both sites only to find newer faces or no trace of the company, whatsoever. Except for the Parus Business Center in Kyiv where the company had rented out a small space till February 2020.
Notwithstanding the cybersecurity firm could be reporting more assets, locations, and employees than they currently have, ExMarkets report stated.
While the discoveries are yet to be fully verified and questions sent to both teams yet to be answered, the story looks to drag on in the near future. Falsification of information in the crypto ecosystem is a tactic used by scam projects to con buyers and make an impression on the well-being of their project.
As the drama between ExMarkets, Hacken and Coinmarketcap unfolds, the crypto ecosystem stands to benefit the most on how to prevent such cases in the future.