Hackers stole $400 million worth of crypto coins from Coincheck

Randall Padilla
January 28, 2018

What is believed to be the biggest cryptocurrency marketplace hack ever has just occurred in Japan, where digital thieves made off with over half a billion dollars worth of NEM (XEM) tokens, CoinDesk reports. Mt. Gox declared bankrupcy in what became one of the largest crypto scandals that shook the market in 2013-2014.

If the theft is confirmed, it will be the largest involving digital currency.

The Financial Services Agency had urged Tokyo-based cryptocurrency exchange Coincheck Inc.to address security concerns about the way it manages customer assets before Friday's ¥58 billion theft of NEM tokens, it was learned Saturday.

Similar to bitcoin, NEM is a cryptocurrency built on top of blockchain but it uses a more environmentally friendly method to confirm transactions. Bleeping Computer reported that the hackers may have stolen nearly seven percent of all the NEM tokens now in circulation.

Mt Gox may have been carrying the torch for suffering the biggest theft in the short history of cryptocurrency and the history of technology itself, there is already another contender.

The exchange posted several updates in a blog post and that announced that "certain Coincheck Payment features will be temporarily unavailable starting at 5 pm JST on 1/27/2018". "As soon as the cause is known", it continued, "we will take measures to prevent recurrence". The exchange has about 6 percent of Yen-Bitcoin trading, ranking fourth by market share on CryptoCompare. Coincheck co-founder Yusuke Otsuka said, "We know where the funds were sent". Kaspersky Lab's Costin Raiu said there was a transfer of $110 million worth of Ripple out of Coincheck, adding "hacking suspected".

"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.

It is still unclear as to how many Coincheck users were impacted by the hack.

The trade freeze looks to be tied to NEM, which consequently saw the following message sent out to users on the exchange: "Depositing NEM on Coincheck is now being restricted".

Other reports by AllAboutTopnews

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