Bitcoin Dives Sharply As Ripple (XRP) And Ethereum Lose Ground–Here’s Why

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Bitcoinwhich has been trapped in a bear market over the whole of 2018has fallen sharply overnight, dragging other major digital tokens, including Ripple’s XRP and ethereum, down.

The bitcoin price has lost some 4% in value over the last 24 hours, with bitcoin dropping around $150 in a matter of minutes and taking it to just over $3,600 per coin, according to prices on the Luxembourg-based Bitstamp exchange.

The bitcoin market appears to have been spooked by reports the Electrum cryptocurrency wallet has had almost 250 bitcoin, worth almost $1 million, stolen—however, movements on the cryptocurrency market are famously hard to explain

The bitcoin price has been on a downward trend since the beginning of 2018 and looks set to close the year far from its January highs.Getty

The bitcoin wallet attack, revealed by Electrum developers on GitHub yesterday, used phishing to trick users into providing password information through a fake version of the wallet.

People trying to access their wallets were asked to provide a two-factor authentication code—something not used by Electrum. Hackers then moved the wallet balance to another they control.

The attack on wallet users began on Friday last week, December 21, and appears to have been halted after GitHub admins acted, according to Electrum developers.

The bitcoin price took a sharp turn downward last night.CoinDesk

The attack was picked up by Reddit user u/normal_rc, who posted that “the hacker setup a whole bunch of malicious servers.”

“If someone’s Electrum wallet connected to one of those servers, and tried to send a BTC (bitcoin) transaction, they would see an official-looking message telling them to update their Electrum Wallet, along with a scam URL,” u/normal_rc wrote

Electrum then took to Twitter to warn users of the attack, asking them not to download Electrum from any other source and stating “there is an ongoing phishing attack against Electrum users.”

Bitcoin exchange and wallet hacks have previously been blamed for sudden falls in the bitcoin price, though the market often rebounds quickly if it’s found the damage is contained.

Bitcoin cash, a fork of bitcoin itself, led major tokens lower.CoinMarketCap

As bitcoin fell on reports of the attack, ripple, a common name for the XRP digital token, and ethereum also dropped. Ripple is off some 5% over the last 24 hours, while ethereum is down almost 6%.

Bitcoin cash is the biggest loser over the trading period, with its price down 10% as it and bitcoin SV continue to suffer in the aftermath of a civil war amongst developers and miners that threatened to collapse the bitcoin rival.