Japan Cryptocurrency Exchange Coincheck starts refunds for $530m hack

The cryptocurrency exchange that fell to a hack of about $534 million in January this year has now started reimbursing the affected customers that lost fund in the hack.

In its blog post, Coincheck said that it will refund users as per its original compensation plan at the rate of 88.549JPY ($0.83) per NEM stolen and that to qualify for reparations, users must have held that amount of NEM on their platform at 23:59:59 JST on 26 January, 2018.

The total amount reimbursed will equal to about $420 million.

After the hack, Coincheck had imposed restrictions on trading and withdrawal of some cryptocurrencies on the exchange. The company is now going to lift some of these restrictions to allow for withdrawals and sales, according to another blog post.

It also said that it is working on evaluating the risks associated with each currency and will “confirm the technical security of our systems regarding these currencies in order to resume normal operations.”

The exchange also plans to resume deposits and purchases of all currencies, and open for new registrations once security and management systems have been updated.

“Once again, we would like to apologize for the inconveniences that the illicit transfer of NEM from out platform and the resulting suspension in services has caused our customers and anyone else affected by this incident. Thank you for your patience,” the company said in its blog post.

Japan cryptocurrency exchange to refund stolen assets worth $400m

Coincheck, one of Japan’s major cryptocurrency exchange, has promised to refund to its customers about $423m (£282m) stolen by hackers two days ago in one of the biggest thefts of digital funds.

The hack occurred on Friday, when the company detected an “unauthorised access” of the exchange and suspended trading for all cryptocurrencies apart from bitcoin.

The attackers were able to access the company’s NEM coins, which are a lesser known but still the world’s 10th biggest cryptocurrency by market capitalisation. The losses went up to about $534m (£380m).

The company has stated that it will reimburse the affected customers to nearly 90% of their loss using cash.

Over 260,000 are reported to have been affected by the hack.

According to Coincheck, the hackers were able to steal the NEM coins because they were kept in online “hot wallets” instead of the more secure and offline “cold wallets.”

The company claims that it is aware of the digital address where the coins have been transferred and believes the assets are recoverable.

Bitcoin Exchange Files for Bankruptcy After Being Hacked Again

Earlier this week, a major South Korean bitcoin exchange, Youbit, was hacked for the second time in less than 8 months. It has since filed for bankruptcy after releasing that the hackers had stolen 17% of its digital currency reserves.

The exchange trades ten virtual currencies, including bitcoin and ethereum.

Youbit says that the hackers had attacked its “hot-wallet”, which is an account kept online for holding crypto assets, and that its offline, cold-storage holdings are safe and still accessible, adding that all customers will be able to withdraw 75% of their assets once the bankruptcy proceedings are settled.

Allegedly, this attack is an addition to the series of cyberattacks in South Korea, all credited to North Korean hackers targeting the growing market of cryptocurrencies in South Korea.

This hack accentuates the growing concern in the market for the safety of digital currency and holdings.

While with traditional banking, people feel safe with their finances and there is less risk for the customers, cryptocurrencies are highly risky and are increasingly targeted by hackers.