Hacked Japanese Crypto-Currency Exchange Coincheck to Return 90% of Stolen NEM Tokens
Following a recent cyber-attack that resulted in the theft of NEM tokens from Japanese crypto-currency exchange Coincheck, the company has made a promise to return around 90% of the stolen tokens to affected customers. This equates to 523 million XEM, equivalent to $425 million, which will be redistributed to approximately 260,000 users impacted by the attack. The repayment will be made in Japanese yen from company funds through users’ Coincheck Wallet, as stated in a blog post released by the firm.
Coincheck expressed its remorse for the incident, acknowledging the distress caused to customers, other exchanges, and individuals within the cryptocurrency industry. The company issued a sincere apology to all parties affected by the illicit transfer of funds and the resulting suspension of services. In an effort to resume operations, Coincheck is actively investigating the cause of the unauthorized transfer, enhancing security measures, and pursuing registration with the Financial Services Agency as a Virtual Currency Exchange Service Provider.
Security Breach and Response
The cyber-attack prompted Coincheck to halt platform operations on Friday, with reports indicating that the stolen crypto-currency was housed in an internet-connected “hot wallet” rather than a more secure “cold wallet.” This vulnerability underscores the importance of robust security practices in safeguarding digital assets from malicious threats.
Rising Threats in the Crypto-Currency Landscape
A recent report highlighted the growing trend of cyber-criminals targeting initial coin offerings (ICOs) and crypto-currency exchanges. With $2 billion already stolen from such entities, these platforms have become prime targets for malicious actors seeking financial gain. Notably, North Korean hackers have intensified their attacks on exchanges, employing tactics like spear-phishing emails to obtain employee credentials and gain unauthorized access.
Government Involvement and Sanctions
The surge in cyber-activity coincides with stringent sanctions imposed on the Kim Jong-Un regime, raising suspicions of government-backed efforts to acquire funds through illicit means. This alarming trend underscores the need for heightened vigilance and enhanced security measures within the crypto-currency industry.