Coincheck lost $530 million worth of crypto coins to hackers

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Hackers allegedly stole 500 million units of NEM, a newer cryptocurrency, leaving the Mt Gox (another Japanese exchange) hack of 2014 behind.

A cryptocurrency exchange in Asia called Coincheck has announced that it was the victim of a massive hack that saw hundreds of millions of dollars worth of cryptocurrency stolen in what is the largest heist of its kind in history.

"We are deeply sorry for troubling people with this issue", Coincheck CEO Koichiro Wada said at a almost 1½-hour-long news conference that lasted until about 1 a.m. Saturday.

Coincheck stopped trading, withdrawal, and deposits of XEM, NEM's cryptocurrency, at 04:00 UTC this morning.

The hack is one of the biggest ever, nearly matching the $500 million loss from the Mt. Gox exchange in 2014.

Coincheck officials are now pondering a method of compensating some of the users who suffered losses, according to a user who live-tweeted the Coincheck conference [1, 2].

Coincheck confirmed Friday that the hack, now likely the largest ever in the space, occurred on its servers early afternoon local time in Tokyo. Coincheck thusly limited withdrawals of all monetary forms, including yen, and exchanging of digital forms of money other than bitcoin.

The NEM team was reported to have said that it will not pursue a hard fork in order to restore the stolen funds, but that it is planning on "tagging" the affected tokens, presumably in a bid to make them harder for the thief or thieves to unload. In April 2017, the agency revised the payment services law to require that virtual currency exchanges become registered. Other cryptocurrencies including Bitcoin, Ether and Litecoin also gained. Wong told Cryptonews that NEM's technology was not responsible and that Coincheck did not implement NEM's multi-signature smart contract, "and that's why they could have been hacked". However, some reports, including one from The Guardian, suggest that the November loss could go as high as $300 million.

However, the hack lowered the value of the digital coin, tallying up the total loss to more than $400 million.

"This case could cause distrust of the virtual currency industry, so we deeply regret [the incident]", Wada said.

The daily moves have been particularly choppy, with the cryptomarkets having to continue responding to news hitting the wires of a likely increased level security from regulators in key cryptocurrency markets.