Japanese Exchange Coincheck Suffered the Largest Theft in Cryptocurrency History

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by Polina Chernykh · 3 min read
Japanese Exchange Coincheck Suffered the Largest Theft in Cryptocurrency History

One of the biggest cryptocurrency exchange platforms in Japan has confirmed it experienced major hack today’s morning, losing $530 million in NEM tokens.

The Tokey-based cryptocurrency exchange website Coincheck halted customer withdrawals in all digital currencies earlier today, following a major hacking attack.

The first news on the suspension appeared earlier today, when the exchange announced that it stopped withdrawals and trading of the XEM cryptocurrency. The halt has subsequently spread to all virtual currencies, including fiat money.

“All withdrawals from the platform are currently restricted, including JPY. Thank you for your understanding. We are doing our utmost to resume normal operations as soon as possible,” Coincheck said in a blog post.

“Purchases and sales of cryptocurrencies other than BTC (altcoins) are currently restricted. Please accept our apologies for this inconvenience. Currently, credit card, Pay Easy, and convenience store payments are suspended. We sincerely apologize for these inconveniences and will continue to do our best to be back to normal operations as soon as possible.”

A few hours ago, Coincheck confirmed a hack during a press conference, saying 58 billion Japanese yen or $530 million worth of NEM were stolen from the exchange. According to the executives, the company is still going to restart trading, although there is no clear plan yet. NEM was the only cryptocurrency affected.

According to Lon Wong, the president of NEM.io Foundation, lack of safety was the main reason for the Coincheck theft.

“As far as NEM is concerned, tech is intact. We are not forking. Also, we would advise all exchanges to make use of our multi-signature smart contract which is among the best in the landscape. Coincheck didn’t use them and that’s why they could have been hacked. They were very relaxed with their security measures,” Wong told Cryptonews. “This is the biggest theft in the history of the world,” he added.

However, as Bloomberg tech reporter, Yuji Nakamura, informed, Coincheck denied to admit at a conference that security was the main issue, thus causing fury among reporters and exchange users. He tweeted:

Bitcoin has dropped 7% on the news, while Ethereum and Ripple fell by more than 5% and 12%, respectively. At the time of writing, bitcoin is trading at $11 089, CoinMarketCap shows. NEM has been obviously affected the most, losing about 18% in value. Currently, it is worth $0,85, according to CoinMarketCap.

In addition to the XEM theft, an XRP transaction worth $123.5 million has reportedly left the platform on Friday. However, it’s still unknown whether that payment was related to the hack.

Opened in 2012, Coincheck is now one of the most popular cryptocurrency exchanges in the country. However, unlike other Japanese exchanges, like bitFlyer, it doesn’t have a license from Japan’s Financial Services Authority, a regulator that oversees local exchanges.

Altcoin News, Cryptocurrency News, News
Polina Chernykh

Polina is an undergraduate student at Belarusian State Economic University (BSEU) where she is studying at the faculty of International Business Communication for a degree specializing in Intercultural Communication. In her spare time she enjoys drawing, music and travelling.

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