Facts: Thirty Two Million Dollars Japanese Crypto Exchange Hack


Crypto Exchange: Reportedly, Bitpoint has identified an unauthorized outflow of the Cryptocurrency from the platform. The team was quick enough to suspend all its services with an immediate effect maintaining that they are working hard to uncover the cause, identify the outflow and as well as minimize the damage caused. It has been further revealed that among the lost funds, 2.5 billion yen, which is equal to $23 million, belonged to the platform’s customers. Meanwhile, one billion yen, which is $9.2 million, of the stolen funds belonged to the exchange.

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Bloomberg Report suggests that Bitpoint’s parent company named as Remixpoint, the shares of which plunged 13 percent of their daily lower limit while they “remained untraded in Tokyo as of 1:44 p.m. on a glut of sell orders”. According to the reports, only the hot wallets of the company were compromised that contained the aforementioned Cryptocurrencies while the cold wallets of the Tokio-based exchange Remixpoint are said to be unaffected by the severe hack. As of now, no further details about the hack have been shared by Bitpoint.

The Cryptocurrency exchanges in Japan were just on the heels of recovering from the uncertain rough patch that they had been going through due to the tight inspections and obligations of the Financial Services Agency (FSA), which is the top financial watchdog of Japan. Japanese law needs companies that are much interested in operating the crypto exchanges to register with the FSA. As the reports go on, as of now 19 registered platforms are operating in Japan of which 16 were approved back in 2017 while the remaining three managed to acquire the approval this year itself. The FSA had held off on all the approvals in the previous year while making 2018 particularly tough on Cryptocurrency exchanges in the region.

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It is quite of great interest that the freshly hacked Bitpoint was one of the exchanges which received registration early in September 2017. Nevertheless, prior to the hack, the exchange has reportedly served a business improvement order by FSA during the agency’s inspection drive. In addition to Bitpoint, several other crypto exchanges bore the brunt of FSA’s investigations, including one of the country’s largest crypto exchanges counted by trading volume, Bitflyer. Bitflyer, after freezing its services for a year, had resumed its operations only recently, on July 3. Very much like Bitpoint, the platform received a business improvement order from the FSA; hence it voluntarily suspended all its services. Upon resuming its operations, the company wrote the following:

Besides this, Fisco crypto exchange, which is most famous for acquiring the registered crypto exchange Zaif, has also received an administrative order, after it got hacked in September last year. The reason behind the administrative order, according to the agency, was that the management did not recognize the importance of the legal compliance thus leading to a number of legal violations. FSA further explained as below:

Taking another instance, Cielo EX Ltd. is another crypto exchange that has received multiple warnings from the FSA. This one, however, seems rightful so as the exchange is known for providing services to Japanese residents without any sort of authorization. The platform also offers the trading of several Cryptocurrencies including BTC and Asobi Coin (ABX). On the bright side, just earlier on Monday, the FSA has revealed that about 110 exchanges showed interest in the Japanese market and several of them are in “various stages of registration”. And that is why the Bitpoint hack comes at an inconvenient time; it could jeopardize other exchanges as FSA will be on its toes over again.

Today’s hack of the Japanese crypto exchange marks 2019’s sixth breach following the $40 million hacks of top crypto exchange Binance and more recently the $5 million hack of the Singaporean crypto exchange, Bitrue. According to The Block’s research, the total amount ever stolen from the Cryptocurrency exchanges now stands at nearly $1.39 billion.

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Source: BlockPublisher

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