Cryptocurrency Exchange Loses More Than $500 Million in Possible Hack

The heist at Coincheck involved 523 million tokens from a cryptocurrency known as NEM.

learn more about Michael Kan

By Michael Kan • Jan 29, 2018

via PCMag

This story originally appeared on PCMag

UPDATE 1/29: Coincheck says it will repay approximately 260,000 customers who lost money in the hack.

Original Story:

A Japanese cryptocurrency exchange called Coincheck has lost currency worth approximately $500 million.

The heist involved 523 million tokens from a cryptocurrency known as NEM, which belonged to Coincheck customers. On Friday morning, the funds had been "illegally remitted" outside the exchange.

Coincheck is investigating the incident, including whether any computer hacking was involved, the company's executives said during a Friday press conference. For now, the exchange has suspended some trading over the site.

The heist is one of the biggest to hit the cryptocurrency market. It exceeds the initial $460 million in bitcoin the Mt. Gox exchange reported losing to hackers in 2014. (Due to the rising price of Bitcoin, the stolen funds from Mt. Gox are now worth over $7 billion.)

While details about the Coincheck theft remain scant, the number of cryptocurrency-related hacks has only been growing. In December, a cryptocurrency mining platform known as NiceHash reported losing $70 million in bitcoin. Cybercriminals managed to snatch the funds by compromising a company computer and stealing an engineer's login credentials. In 2016, another bitcoin exchange named Bitfinex lost what was then $60 million in a separate breach.

Security experts have warned that hackers, including those from North Korea, have been targeting the cryptocurrency industry. Some of the attacks have involved sending phishing emails that try to trick the victims into installing malware.

The heist at Coincheck is certainly a worrisome sign for investors. Using unique passwords and two-factor authentication can better protect your cryptocurrency account from hacking. But the protections go to waste when the companies themselves experience a breach.

Michael Kan

Reporter

Michael has been a PCMag reporter since October 2017. He previously covered tech news in China from 2010 to 2015, before moving to San Francisco to write about cybersecurity.

Related Topics

Editor's Pick

Have More Responsibilities at Work, But No Pay Bump? Use This Script to Get the Raise You Deserve.
Black and Asian Founders Face Opposition at All Levels — Here's Why That Has to Change
Business News

Frontier Airlines Just Announced Its All-You-Can-Fly Summer Pass for $399. What's the Catch?

As travel begins to pick up, the airline hopes unlimited travel will jumpstart its business.

Making a Change

5 Principles for Dealing With Constant Change

Build competencies for adaptability into your company or risk losing your way in an ever-fluid marketplace.

Marketing

What Millennials Really Think About Product Life Cycle, As Told By A Millennial.

Millennials have come into significant purchasing power, and I know how you can capitalize on that.

Business Ideas

55 Small Business Ideas To Start Right Now

To start one of these home-based businesses, you don't need a lot of funding -- just energy, passion and the drive to succeed.

Money & Finance

How NFTs Work — and How They Could Prove Profitable for Your Business

NFTs seem to be all the rage these days, but can they actually work for most businesses?