One of Japan's largest digital currency exchanges, Coincheck, has apologised to investors for losing up to 420 million euro in virtual money. Bloomberg, which was present during the conference, reported earlier today that NEM deposits were being suspended before the exchange stopped all NEM trading. In this way, the massive Coincheck theft is superficially reminiscent of the infamous Mt. Gox hack of 2014, but differs in key ways that underscore how far the industry has come.
The Financial Services Agency has required virtual exchanges to be registered since last October, to protect consumers. "They were very relaxed with their security measures", he Cryptonews, calling the heist "the biggest theft in the history of the world". "Please accept our sincerest apologies for this inconvenience", the blog post reads. While that may be peanuts compared to the 30 trillion yen or so once held by Bitcoin, the largest of any digital currency, NEM was popular with individual investors. As a result, Coincheck restricted withdrawals of all currencies, including Yen, and trading of cryptocurrencies excluding Bitcoin. He said the organization may look for monetary help, as indicated by Kyodo News reports. This was followed by a similar suspension of trading for all cryptocurrencies, except bitcoin.
Cofounder Yusuke Otsuka said the company did not know how the 500 million tokens went missing, and the firm is working to ensure the safety of all client assets.
He wrote that he has an investment of more than ￥10 million (US$92,000) worth of bitcoin in Coincheck.
"I would've thought that the whole crypto landscape would've been down quite a bit on this news of a major Japanese exchange getting hacked", said Michael Graham, senior equity analyst at Canaccord Genuity. Wong told Cryptonews that NEM's technology was not responsible and that Coincheck did not implement NEM's multi-signature smart contract, "and that's why they could have been hacked".