Bitcoin and cryptocurrency exchange CoinWallet.co has announced that they will be closing the business effective May 1 following a data breach.

According to the closure announcement post, the hack occurred April 6 and involved the person behind the attack inserting bad code in a recently added feature that allowed user input.

Encrypted details of user passwords were obtained by the hacker, however, a backup security system prevented the theft of any funds.

The vulnerability has since been patched although the company added that they were still trying to determine the extent of the breach; staff have since force changed passwords but recommend users change their passwords on any other crypto related websites they have if they use the same password.

“We used encrypted and salted passwords but given enough time these should be assumed compromised,” they noted.

Not worth it

Despite the fact that the vulnerability has been repaired and no funds were stolen, CoinWallet.co has decided none the less to close up shop on the basis that the ongoing work to be safe against these sorts of attacks makes continuing on not worth it.

“This incident prompted us to reassess the viability of running coinwallet.co and it was decided it is just not viable taking into consideration the risk, costs and time involved,” it was noted.

The announcement from CoinWallet.co follows a string of hacking incidents within the Bitcoin and cryptocurrency space in the last month, including ShapeShift AG, and Coinkite, Inc. with Coinkite notably deciding to stop trading as well as they were sick of dealing with the BS involved in targeted attacks.

Not every company working in the space has the skills, or financial backing, to ward off attacks, and it’s understandable why some choose to walk away.

The only company in the space we are aware of to have fought and won a widespread battle with attackers was BTCC Technology Ltd. , who famously stood firm during an attack in January and won, but spent a serious amount of money doing so.

As a market there’s no easy solution to bad actors targeting companies except time and money, but until there is expect to see many of the smaller players in the cryptocurrency space following CoinWallet.co out the door.

Image credit: btckeychain/Flickr/CC by 2.0