CatalX, a Canadian cryptocurrency trading platform, has suspended all trading activities and withdrawals after discovering a security breach that resulted in the loss of client crypto assets.
In a statement, CatalX revealed that its management recently detected a breach that allowed unauthorized access to an unspecified amount of cryptocurrencies held on behalf of clients.
The Calgary-based trading venue caters to retail and institutional crypto traders across Canada. However, an unfolding investigation suggests that lax internal security protocols may have enabled bad actors to misappropriate user funds.
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CatalX stated the possible involvement of an employee
CatalX stated that the security lapse likely involved a rogue employee within the organization. The firm has enlisted Deloitte’s investigative and forensic teams to undertake a thorough examination of the breach.
All withdrawals and deposits on CatalX remain halted until Deloitte completes its independent audit. The precise scale of the crypto asset loss also remains unclear.
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In its statement, CatalX committed to transparently sharing the outcome of the investigations in upcoming status updates. Its response to compliance with provincial regulators also remains under scrutiny.
While crypto asset thefts have long plagued the digital asset industry, this marks the first major Canadian exchange breach with a significant client fund loss.