$530 million lost due to hacking at Japan cryptocurrency exchange

Marcus Newton
January 28, 2018

Tokyo-based cryptocurrency exchange Coincheck has confirmed that it has suffered the biggest theft in the history of cryptocurrency. The exchange first moved to halt all trading in NEM, the cryptocurrency allegedly at the center of the theft, Coincheck went on to halt all other activity.

Apparently, the 523m coins - worth about half a billion dollars for now - were stored by CoinCheck on a remotely accessible hot wallet at the time of the computer security breach.

Regardless of the official tally, it's a major theft, surpassing the ~$340 million that was famously stolen from Mt. Gox in 2014. The access was discovered by the company at around 11:00 a.m. The amount may pale in significance to the cryptomarket's $550.5bn market cap, but it's yet another example of just how unsecure cryptocurrencies can be and gives regulators more reason to take a greater interest in cryptocurrencies and its dealings. Today, there are many more exchanges, and many more cryptocurrencies.

"We will calculate the price using the weighted average of the volume, with reference to the virtual currency exchange Zaif's XEM / JPY (NEM / JPY) operated by Tec BURO Co., Ltd., which has the largest handling volume of NEM in Japan and overseas".

What's more, while the onramps for cryptocurrencies remain rickety, the markets have learned to differentiate them from the superhighways they connect to.

We're watching for further developments.

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UPD: There is still no clear information whether this was a hack or a planned action.

For Coincheck, it's now a matter of keeping other crypto-assets safe as they investigate what happened.

Separately, Paul Rieger, a member of the NEM Europe team, which developed the XEM token, told CoinDesk that his organization was tagging the stolen XEM and sharing the affected addresses with exchanges.

In the press conference that the cryptocurrency exchange officials had organized, the CEO didn't speak much about security weaknesses and when probed, all he did was apologize about the hack.

NEM trading price dropped from $1 to $0.8 following the hack announcement.

Other reports by MaliBehiribAe

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