NiceHash halts repayments after hack

Slovenia-based crypto mining hash power broker NiceHash has announced it may not be able to fulfill its promise to fully reimburse internal and external wallet users affected by the December 2017 hack. During the hack, the service lost over $60 million in BTC (about 4,700 BTC) due to the site’s payment system being compromised and its BTC wallets emptied.

The repayment program started on February 2, 2018. In a December 18 post on the company’s blog, NiceHash advised users it halted the repayment program for the foreseeable future. 82% of those affected by the security breach has been successfully reimbursed, with only 18% still to repay. The company is unable to give any time estimates for when all 100% of those affected will eventually be refunded. 

The team explained in the blog post that they have been repaying the old balance to our users through their fees, which caused lowered income. The income and repayment program assets are subject to taxation. The current status of the program is at 100,04% of the original loss value in NiceHash’s accounting books. NiceHash will not be able to honor its commitment to fully reimburse all users and achieve the 100% reimbursement status.

NiceHash announced details of the reimbursement program in advance, and users were able to monitor repayment progress. The old balance was repaid in BTC, not the fiat value or any other cryptocurrency. To stay in business with enough capital to maintain operations and fund future development within the company, NiceHash “paused” the repayment program.

NiceHash indicated they would resume the repayment program in 2020 if they see positive development within the crypto market. The company will continue with the legal procedures in their home country regarding the program. All information regarding repayment will remain visible in users’ wallets.

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