$400 Million Missing In Hack Of Japanese Digital Currency Exchange
A Japanese cryptocurrency exchange announced the theft Friday of $400 million in digital currency. Some estimates put the loss at the Coincheck exchange at over $520 million.
The stolen assets were stored in the cryptocurrency NEM, one of hundreds of digital currencies created in recent years. Bitcoin, the most well-known cryptocurrency, dropped precipitously on news of the hack but has since regained much of its value.
The incident could be one of the largest single losses of cryptocurrency ever, rivaling only the 2014 hack of online exchange Mt. Gox. Reports at the time put Mt. Gox's losses at over $400 million.
Coincheck says 500 million digital coins were lost. According to Cointelegraph, hackers stole the private key protecting access to Coincheck's accounts.
Japan's Financial Services Agency announced it is "looking into" the loss, while most activities on the exchange were suspended Friday. Coincheck said in a statement that the exchange is trying to ensure that consumer assets are protected.
As NPR previously reported, U.S. regulators are increasingly worried that cryptocurrency markets are vulnerable to manipulation and theft.
SEC Chairman Jay Clayton warned in December that cryptocurrency markets have "substantially less investor protection than in our traditional securities markets, with correspondingly greater opportunities for fraud and manipulation."
The SEC had previously warned that investors may have "limited recovery options" in the event of a hack, as exchanges are often based outside of the United States.
Ian Wren is NPR's business news intern.
Copyright 2021 NPR. To see more, visit https://www.npr.org.