Investors who lost money in the Atomic Wallet $100 million data breach have filed a class-action lawsuit against the company, citing poor response to the issue. The suit, handled by German lawyers Max Gutbrod and Boris Feldman of Destra Legal, alleges that Atomic Wallet failed to notify clients on the hack and failed to disclose it to police.
Gurbrod and Feldman are reportedly representing around 50 clients who suffered a combined loss of $12 million in the Atomic Wallet case. Their representation highlights how those affected experienced a substantial financial impact. At least 5,500 crypto accounts on the noncustodial wallet platform were hacked in the June breach. While earlier allegations blamed the North Korean Lazarus Group, additional claims indicate a possible Ukrainian group’s involvement.
The response of Atomic Wallet to the intrusion has come under scrutiny. While the company refrained from disclosing the precise circumstances that triggered the exploit, it did outline four “probable” sources. These sources included user device viruses, infrastructure breaches, man-in-the-middle attacks, and malware code injection. According to the company, less than 0.1% of app users were affected.
Atomic Wallet Breach Spurs Class-Action Suit and Raises Industry Concerns
The lawsuit also raises issues about crypto services providers’ incident response and communication strategies. A lack of openness and fast information sharing can have a negative impact on both users and platforms.
The case highlights the possible consequences of such instances on the broader cryptocurrency ecosystem. As the industry expands, regulatory scrutiny, legal actions, and accountability become increasingly important. Instances like the Atomic Wallet leak underscore the significance of well-defined protocols and transparent communication during security breaches. These measures are crucial for maintaining user trust and ensuring their protection.
Currently, Atomic Wallet has chosen not to comment on the issue. However, the ongoing lawsuit has the potential to establish a precedent for addressing similar incidents involving cryptocurrency service providers in the future. The ability of organizations to effectively handle and mitigate the consequences of security breaches will play a pivotal role. This will contribute significantly to shaping the overall trustworthiness and credibility of the cryptocurrency landscape as the market continues to develop.