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Canadian exchange sues Binance after losing $3 million in software glitch 

Canadian exchange sues Binance after losing $3 million in software glitch

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TL;DR

  • Canadian exchange, Coinberry said it lost about $3 million in bitcoin due to a software glitch.
  • Only one-third of the bitcoin has been recovered since the incident happened.
  • It recently filed a lawsuit targeting Binance and 50 customers for the misappropriated coins.

Coinberry, a cryptocurrency exchange based in Canada, recently filed a lawsuit blaming the largest exchange Binance for its losses during a software glitch two years ago, which wasn’t previously disclosed. Owned by WonderFi, the digital asset company backed by Kevin O’Leary, Coinberry claimed it lost about $3 million in bitcoin. 

How Coinberry lost $3 million in a glitch, blames Binance

According to Financial Post, the Canadian exchange experienced a technical issue during a software upgrade in 2020, which allowed hundreds of its customers to purchase bitcoin for free. The glitch enabled the users to credit their accounts upon initiating an electronic transfer. They bought and withdrew bitcoin from the exchange and then canceled the original transfer. 

In the lawsuit filed in June, Coinberry said they lost 120 bitcoins amid the incident and has only managed to recover about 37 of the misappropriated coins from 270 customers. It suspects that at least 500 customers took part in the illicit act but targeted about 50 customers in the lawsuit. 

The exchange also named Binance in the lawsuit, despite that saying, “Binance acknowledged that it had identified a quantity of the misappropriated BTC and undertook to restrict any access to the accounts.” Coinberry blamed Binance mainly because some of the bitcoin was moved to the platform.

Through the lawsuit, Coinberry intends to claw back the remaining 63 bitcoins, including the 9.48 sent to Binance. However, the lawsuit is yet to be tried in court, according to the report.

Crypto exchanges are losing millions erroneously

Earlier this month, Cryptopolitan reported a similar case where Coinbase lost millions of dollars to some of its users in Georgia. The issue resulted from an erroneous price feed that inflated the rate of the Georgian Lari (GEL), the legal tender of Georgia, by 100x. This enabled the users to cash out $10,000 for $100.

Crypto.com recently initiated legal actions to recover about $10 million it mistakenly transferred to a customer. 

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Ibiam Wayas

Ibiam is an optimistic crypto journalist. Five years from now, he sees himself establishing a unique crypto media outlet that will breach the gap between the crypto world and the general public. He loves to associate with like-minded individuals and collaborate with them on similar projects. He spends much of his time honing his writing and critical thinking skills.

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