March 5, 2014 - 14:09 AMT
PanARMENIAN.Net - Bitcoin bank Flexcoin has ceased operations after being hit by a cyber attack, Digital Spy said.
Hackers stole $608382 worth of the virtual currency from the company over the weekend, a loss it was unable to recover from.
"On March 2, 2014 Flexcoin was attacked and robbed of all coins in the hot wallet," said Flexcoin in a statement issued March 4.
"As Flexcoin does not have the resources, assets, or otherwise to come back from this loss, we are closing our doors immediately."
Some of the company's assets were kept in cold storage, on devices that were not connected to the internet, but this service was only provided to customers who paid extra for it.
"Users who put their coins into cold storage will be contacted by Flexcoin and asked to verify their identity. Once identified, cold storage coins will be transferred out free of charge," the firm added.
"Cold storage coins were held offline and not within reach of the attacker. Flexcoin will attempt to work with law enforcement to trace the source of the hack."
The news follows word that the world's largest Bitcoin exchange MtGox has filed for bankruptcy after losing around 750,000 units of the currency to suspected theft.
Earlier on March 4, British tax authority HM Revenue & Customs (HMRC) declared that Bitcoin trading in the UK will not be subject to value added tax (VAT).