Localethereum: Talking about currency security from the hack of the world's seventh largest digital currency exchange

According to Yonhap News Agency, Bithumb, the world's seventh largest digital currency exchange, was robbed on Wednesday (June 20), with about $30 million in digital currency stolen. Bithumb is South Korea's largest bitcoin exchange, and this theft is the second digital currency theft suffered by a South Korean digital currency exchange in two weeks.

In response to the theft, Bithumb announced that it would bear all losses and suspended the deposit and withdrawal services for digital currencies, transferring all assets to cold wallets (offline wallets). Centralized digital currency exchanges are frequently hacked, and currency theft has always been one of the urgent problems to be solved in the cryptocurrency circle. The disadvantage of centralized exchanges is that they have centralized credit endorsements, and there may be risks such as the person in charge of donations running away, which may affect the security of customer assets. Secondly, the centralized custody of assets is more vulnerable to hacker attacks, such as the theft of the Bithumb exchange this week.

In comparison, decentralized exchanges are safer. Generally speaking, when users register on such exchanges, they will obtain the public key and private key of the account, or directly import the wallet address. Once the key is lost, it cannot be retrieved! Pre-trading recharge is simpler than centralized exchanges. You can directly recharge the account public key of the decentralized exchange from the wallet address. When initiating a transaction, the transaction is completed by the smart contract of the decentralized exchange. In this process, the user has full control over the digital currency, rather than being subject to the exchange. When withdrawing, the money is directly transferred from the exchange address to the user's wallet address.

Decentralized exchanges only undertake the functions of asset custody, asset trading and liquidation. The public key of the user's account on the blockchain is his or her identity. There is no need to register personal information additionally, so there is no personal information security issue. As long as the private key information is not disclosed to others, the user's assets are safe. The decentralized trading mechanism implemented by smart contracts can solve the problem of user fund security caused by human factors.

Localethereum is such a decentralized exchange. It is a platform that provides information exchange on Ethereum trading. It creates an over-the-counter trading platform for Ethereum trading for the majority of ETH holders or coin enthusiasts who are interested in ETH. Friends who have Ethereum trading needs can first join Localethereum's QQ exchange group: 783740442 to learn more and meet more like-minded friends.

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