Japanese Exchange Hacked? The Biggest Theft in the History of the World


Coincheck announced the shutdown of NEM deposits at about noon Japan Standard Time Friday (10:00pm Eastern Time on Thursday). 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. Shortly after it discovered the theft, the exchange suspended trading of NEM, the stolen crypto in question, then of the other dozen coins it lists.

Coincheck, which calls itself the leading Bitcoin and Cryptocurrency exchange in Asia, said it had detected the unauthorized access to the system shortly before 3 am Friday (1800 GMT Thursday).

Depositing NEM on Coincheck is now being restricted.

Cryptocurrency prices went down after one of Japans biggest exchanges stopped all withdrawal transactions.

Though Coincheck is a major company among virtual currency exchanges, its registration at the Financial Services Agency is still under review, meaning it is not yet registered as a certified virtual currency exchange. Lon Wong, the president of the NEM Foundation, was quoted by Sead Fadilpašić and Stuart Garlick of Cryptonews.com as saying, "This is the biggest theft in the history of the world".

In an official communiqué on its website, the troubled exchange apologized for the inconvenience caused to its investors and other stakeholders.

Japan-based cryptocurrency exchange CoinCheck says it has been taken for around $530m by hackers. If cryptocurrency exchanges do not ban together to require stringent operating principles and strict security protocols, government authorities will. Kaspersky Lab's Costin Raiu said there was a transfer of $110 million worth of Ripple out of Coincheck, adding "hacking suspected". Unlike Bitcoin, NEM is not mineable-all of the XEM was created at the start and distributed to investors.

If you are among those affected by the heist, you can calculate your due amount using the following simple formula: compensation due = 88.549 yen * number of NEM you lost.

It is hard to ascertain the impact of the loss of Coincheck's trading volumes on the overall cryptocurrency ecosystem.