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Japanese bitcoin exchange is robbed of $60 million worth of cryptocurrency

Japanese bitcoin exchange is robbed of $60 million worth of cryptocurrency


Its digital wallet was connected to the internet and remained vulnerable

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Photo by Michele Doying / The Verge

Japanese cryptocurrency exchange Zaif has been robbed of $60 million worth of digital coins, its parent company Tech Bureau announced today, according to Reuters.

Zaif was hacked on September 14th during a two-hour time frame. Three days later, it uncovered server problems and began to investigate. By September 18th, it confirmed it was hacked and notified authorities.

Cryptocurrencies including bitcoin, monacoin, and bitcoin cash were stolen from the exchange’s online wallet, where hackers were able to gain access to through the internet. Of the $59.67 million stolen (6.7 billion yen), almost $20 million (2.2 billion yen) belonged to parent company Tech Bureau, while $40 million (4.5 billion yen) belonged to clients of the exchange. Tech Bureau is working on gaining an investment to pay back its affected customers, but the deal is still pending.

Regulation is still being determined

The hack could impact how Japan’s Financial Services Agency (FSA) views the cryptocurrency industry as it works on a review before determining new regulation. Japan has suffered multiple bitcoin exchange thefts, including the high-profile Mt. Gox, which lost most of its bitcoin to theft in 2014 and had to file for bankruptcy. Customers are still waiting for their money as a result of the bankruptcy.

More recently, bitcoin exchange Coincheck was robbed of $530 million in January, which drew the scrutiny of Japan’s FSA. In that case, the FSA said it found many exchanges lacked proper security measures and protection against money laundering. Exchanges are now required to register with the FSA before opening.