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Highlights
- Crypto millionaires are hiring bodyguards following Coinbase data hack
- Recent kidnapping attempts against crypto executives highlight physical security risks in the industry
- Blockchain's anonymous transfer capabilities make crypto holders particularly vulnerable targets
Wealthy cryptocurrency investors are increasingly turning to professional security services following the Coinbase hack. The hack exposed customer home addresses and account balances to hackers. The security concerns come amid a troubling rise in kidnappings targeting the crypto industry. This includes last week’s attempted abduction of a French cryptocurrency executive’s daughter and grandson.
Demand for protection rises after Coinbase hack
Professional security providers are seeing an increased interest from cryptocurrency investors looking for protection services even before Coinbase hack was publicly disclosed. Jethro Pijlman, managing director at Amsterdam-based Infinite Risks International, told Bloomberg that there was a clear surge in inquiries from concerned clients with substantial crypto holdings.
“We’ve had more inquiries, more long-term clients, and more proactive requests from crypto investors who don’t want to be caught off guard,” Pijlman stated. His firm specializes in physical security and intelligence services for cryptocurrency holders who have become increasingly worried about industry-related kidnappings and threats.
The security expert observes that wealthy crypto investors are now adopting a more proactive approach after the hack. They have also started seeing security as a necessary business expense rather than an optional precaution.
This surge in demand after the Coinbase hack shows growing awareness of the vulnerabilities facing crypto wealth holders. Unlike traditional financial assets, cryptocurrency can be transferred with just a private key. This makes it nearly impossible to recover once stolen.
Ronghui Gu, co-founder of blockchain security firm CertiK and associate professor at Columbia University, confirms this concern. “Cryptocurrency can be transferred with just a private key, and is extremely difficult to recover. This makes crypto traders prime targets for criminals.”
Recent crypto kidnappings highlight physical security risks
A series of targeted attacks against crypto executives and their families has also surfaced amidst the Coinbase hack news. Only last week, intruders attempted to kidnap the daughter and grandson of a French cryptocurrency entrepreneur. The person operates Paymium, a French crypto exchange. While this kidnapping attempt was stopped, it is part of a growing pattern of similar incidents.
David Balland, a co-founder of French crypto wallet firm Ledger SAS, had his hand damaged in January. This happened after he was kidnapped with his partner. These attacks have become frequent enough that France’s Interior Minister Bruno Retailleau has promised to launch a priority emergency police number specifically for the crypto industry. Additionally, elite French police units will provide specific briefings and security checks for cryptocurrency CEOs and their families.
The Coinbase hack has intensified these concerns because hackers gained access to sensitive information that could help identify and locate customers with substantial holdings. Though Coinbase stated the leak affected less than 1% of its monthly transacting users, the compromised data included names, addresses, government ID images, transaction histories, and account balances. The hack even affected Sequoia Capital’s Botha.
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