Fortress

<figure> 
 <figcaption>
  Cover image via <a href="https://u.today/">U.Today</a>
 </figcaption> 
</figure>
<p lang="en-GB" xml:lang="en-GB">Mike Belshe, chief executive of BitGo crypto exchange and major U.S. crypto custodian, has shed light on the recent exploit of Fortress Trust, a company recently <a href="https://u.today/ripple-unveils-new-mega-deal">acquired by Ripple</a>. The fintech giant owning the company has admitted that a breach did occur, while Fortress has not so far.</p>
<p lang="en-GB" xml:lang="en-GB">What's more, it has published a tweet to maintain that no funds were lost. Belshe dispelled allegations that BitGo was somehow involved in this.</p>
<h2 lang="en-GB" xml:lang="en-GB" id="fortress-breach-has-nothing-to-do-with-bitgo-belshe-states">Fortress breach has nothing to do with BitGo, Belshe states</h2>
<p lang="en-GB" xml:lang="en-GB">Fortress Trust used <a href="https://u.today/bitgo-secures-100-million-in-series-c-round-smashes-through-175-billion-valuation">BitGo as a platform for crypto custody</a>. Belshe cited an X post of Jameson Lopp, who stated that funds were lost indeed. What Fortress has admitted so far is that four of its clients were affected by an attempted breach last week; however, as mentioned above, they insist that no funds were lost.</p>
<p lang="en-GB" xml:lang="en-GB">"When Fortress lost funds, they chose to omit facts about what happened, downplay the event, and conclude, most importantly, no funds were lost," Belshe stated.</p>
<blockquote>
 <p lang="en" dir="ltr">I can’t express enough how upsetting this Fortress Trust episode is to me. I really don’t want to talk about it at all, because it actually has nothing to do with BitGo. But because Fortress was not forthcoming about what actually did happen, we are now indirectly affected -… <a href="https://t.co/jXZYGBt93B">https://t.co/jXZYGBt93B</a></p>— Mike Belshe (@mikebelshe) <a href="https://twitter.com/mikebelshe/status/1701322135778820181?ref_src=twsrc%5Etfw">September 11, 2023</a>
</blockquote> 
<p lang="en-GB" xml:lang="en-GB">Mike Belshe insists that BitGo has nothing to do with this breach, as he shared the chronology of what happened to the above-mentioned company that was recently bought by Ripple crypto giant.</p>
<p lang="en-GB" xml:lang="en-GB">The CEO added here that this is a blend of what is already known publicly and extra details BitGo is willing to share.</p>
<h2 lang="en-GB" xml:lang="en-GB" id="chronology-of-events-in-fortress-breach-per-bitgo-ceo">Chronology of events in Fortress breach, per BitGo CEO</h2>
<p lang="en-GB" xml:lang="en-GB">Belshe said that the breach suffered by Fortress was made not via BitGo but through another third-party integration. The hacker managed to withdraw funds from Fortress's system of hot wallets.</p>
<p lang="en-GB" xml:lang="en-GB">The CEO continued by saying that Fortress used Fireblocks and not BitGo to support its system of hot wallets. After noticing the issue had emerged, the company claimed it had fixed the problem with the third party. As for BitGo itself, even though it did store some Bitcoin and other cryptos for Fortress, the custodial platform itself did not suffer any damage. All the crypto assets held by BitGo for Fortress remain safe, according to Belshe.</p>
<p lang="en-GB" xml:lang="en-GB">The CEO claims that as soon as Fortress contacted BitGo about what happened, the exchange immediately advised that it is disclosing the news about the breach to the community. However, Fortress chose to act in another way.</p>
<p lang="en-GB" xml:lang="en-GB">The breach took place before Fortress announced that Ripple was buying it. Now, the San Francisco-based crypto company will compensate those clients for their lost funds.</p>
<h2 lang="en-GB" xml:lang="en-GB" id="decentralization-is-necessary-belshe-concludes">"Decentralization is necessary," Belshe concludes</h2>
<p lang="en-GB" xml:lang="en-GB">This case proves that the crypto space desperately needs decentralization, Belshe wrote, since "We can't continue to be dependent on the honesty of custodians, bankers, or 'trusted third parties' acting with integrity when bad things happen."</p>
<p lang="en-GB" xml:lang="en-GB">"Bad things" will continue to happen, he stressed, and the majority of people in the crypto community are not brave enough to speak openly about it.</p>
<p lang="en-GB" xml:lang="en-GB">Here, Belshe emphasized that BitGo is a "decentralized wallet platform and also a centralized custodian," promising to "ensure that our financial system is not dependent on any one person’s integrity, and to provide transparency wherever possible."</p>

Ripple's Newly Acquired Company Hit by Hackers, Here's What Happened

Table of Contents

U_Today

Other articles published on Sep 12, 2023

Chainalysis: Central, Southern Asia and Oceania dominate crypto adoption

Standard Chartered's Crypto Subsidiary Zodia Custody Launches in Singapore

TON Joins NFTScan’s Growing Portfolio

Franklin Templeton Applies for a Spot Bitcoin ETF With the U.S. SEC

This is Bitcoin's Strongest Recovery Excl. 'ETF-Rally' Since July 13

Fractionalization of real world assets: Is this the holy grail of blockchain tech?

Join our free newsletter for daily crypto updates!