TOKYO—Coincheck, a cryptocurrency exchange here, reports hackers stole $530 million of its customers' cryptocurrency.
The company says a hacker appeared to have gained unauthorized access to its hot wallet after obtaining the private key used to protect it, Bank Info Security reported.
“Cryptocurrency typically gets stored in wallets, with hot wallets referring to Internet-connected repositories that enable exchanges and service providers to facilitate instant payments. Such wallets have been the focus of many online attackers' efforts in recent months as the value of bitcoin in particular has skyrocketed,” Bank Info Security stated.
The first sign of trouble at Coincheck appeared late last week when the exchange warned customers that it was halting sales, purchases and withdrawals of cryptocurrency called XEM. Later in the day, the exchange also suspended withdrawals of Japanese yen, all credit card payments as well as purchases and sales of cryptocurrencies other than Bitcoin, Bank Info Security reported.
The exchange then said that 523 million XEM - at the time, worth about $530 million - had been stolen from 260,000 of its customers. The firm said it immediately reported the theft to police as well as the Financial Services Agency, the Japanese government's financial regulator responsible for overseeing the country's banking, insurance and securities and exchange sectors, Bank Info Security reported.
"We are deeply sorry for troubling people with this issue," Coincheck CEO Koichiro Wada stated in a press conference.
The company said it was offering reparations to customers at the rate of ¥88.549 for every XEM coin held.