$530M NEM Stolen Following Japanese Cryptocurrency Exchange Hack

Chelsea West
January 28, 2018

Some 58 billion yen ($534 million) of the cryptocurrency NEM has disappeared from a Japanese exchange due to hacking, the operator said Friday after halting withdrawals and trade of the virtual currency. The estimated value of coins stolen is $400 million, an amount that is larger than the value of tokens lost in the Mt. Gox crash, which also occurred in Japan. At around 3 a.m. Friday (local Japanese time), essentially all NEM, a type of virtual currency, held by the Tokyo-based exchange was illicitly transferred out of its digital storage.

The Coincheck exchange said on its website Friday that it had halted sales and withdrawals of the currency, which is called NEM.

NEM is said to have market capitalization of 1 trillion yen. Now there are 16 regulated cryptocurrency operations in Japan but Coincheck is not now a licensed platform.

Cryptocurrency prices went down after one of Japans biggest exchanges stopped all withdrawal transactions. Hackers allegedly stole 500 million units of NEM, a newer cryptocurrency, leaving the Mt Gox (another Japanese exchange) hack of 2014 behind. "They were very relaxed with their security measures", he Cryptonews, calling the heist "the biggest theft in the history of the world". This was followed by a similar suspension of trading for all cryptocurrencies, except bitcoin. "We are doing our utmost to resume normal operations as soon as possible", said a blog post from Coincheck.

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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".

"Currently, buying and selling other than BTC (ortho coin) is temporarily suspended". They have had to unfortunately suspended withdrawals of nearly all cryptocurrencies.The exchange has already reported the incident to the police and to Japan's Financial Services Agency.

Billionaire investor George Soros, known for his legendarily successful currency trading, has dismissed bitcoin as a "typical bubble".

It is said to be considering compensating users who were affected. Coincheck is an online marketplace that enables its users to buy and sell cryptocurrency.

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