Atomic Wallet Flagged by Malaysia for Unauthorised Operations

The Malaysian Securities Commission has added Atomic Wallet to its list of financial firms banned from operating in the country.

The action stems from Atomic Wallet's operation of a digital asset exchange (DAX) without proper registration, aligning with the Commission's efforts to regulate the growing cryptocurrency sector.

While no further details were provided, Atomic Wallet, which suffered a $100 million hack in 2023, has since faced multiple lawsuits.

This move is part of a broader crackdown on unregistered cryptocurrency firms in Malaysia, with others like Crypto Trade Malaysia and Best Exchange also prohibited.

The regulator's heightened scrutiny reflects concerns over the security and legitimacy of digital asset platforms, particularly amidst rising cyber threats.

Atomic Wallet 2023 Hacking Incident

Atomic Wallet, a platform claiming to offer secure, decentralised services for staking and swapping over 100 digital assets, has faced significant setbacks in recent years.

In 2023, the company was targeted in a cyberattack that led to losses exceeding $100 million, with some users reporting the complete loss of their crypto holdings, according to Elliptic's analysis.

The hack, allegedly linked to North Korea’s Lazarus Group, reportedly funnelled stolen assets through a Cambodian exchange, Huione Pay.

This triggered a class-action lawsuit in the United States, which was ultimately dismissed due to jurisdictional issues.

In response to the breach, Atomic Wallet initiated a $1-million bug bounty programme aimed at identifying and fixing security vulnerabilities.

It announced a reward of up to $100,000 for anyone who identifies a vulnerability capable of compromising a wallet remotely—without requiring physical access, malware installation, or social engineering.

This offer highlights the company's focus on addressing flaws in its code or dependencies that could enable over-the-internet attacks.

Additionally, the company offered rewards ranging from $500 to $10,000 for discovering other types of security vulnerabilities within its platform.

Despite these efforts, the broader cryptocurrency industry continues to face growing cyber threats.