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###Critical Security Update from BitFlikz### -Internal Report Shows GDAX & Coinbase may be Insolvent
July 30, 2016

###Critical Security Update from BitFlikz### -Internal Report Shows GDAX & Coinbase may be Insolvent

We have come to learn that users may be at risk from the exhanges Coinbase and GDAX. This is breaking right now and we have some pending reports of how deep this may actually reach.

In actual fact, GDAX and Coinbase are related. They are owned by the same company.

It has become apparent that GDAX have suffered major replay attacks in the early trading of the new hardfork (ETHF) clone. They did not properly secure themselves from the attack after advice presented by the Ethereum foundation was taken.

During this period it is unknown what actual amount of ETC was relayed but we have estimated it is much bigger than initially anticipated. This occurred over a number of days as GDAX where assured by the Ethereum foundation there would be no interest in the original and unbreakable genesis chain. They where even aware of the attack vector but left it unpatched. It is specualted this may have been an attempt to kill off their competing chain.

At the time of the attack the $ETC was trading between $0.26 USD and $0.58 cents. It is now trading successfully above $1.80 USD after failed attempts harm the chain.

For every dollar taken during the replay attack they are now in deficit over appx -540%.

Sadly, If $1 million USD in ETH was withdrawn at the time that will place GDAX in a loss of -%540 or over USD $6M at current prices.

If Ethereum classic continues to rise, this may spell disaster if they have not repurchased customer funds.

This may be crippling to a smaller exchange of their size and we understand there are already users having difficulty withdrawing funds and getting deposits credited.

We understand they have just raised fees on their sister site @coinbase to outrageous and unknown levels never before seen inside the crypto world. This may be an attempt to cover the losses sustained on GDAX.

Source: https://bitflikz.com/blogs/news/critical-security-update-from-bitflikz-gdax-coinbase-may-be-insolvent