Coincheck, a Japanese cryptocurrency wallet and exchange service, confirmed in a release that over $500 million worth of digital cryptocurrency, NEM tokens has been stolen, in the world’s biggest crypto hack.
As per the reports by Bloomberg, which attended the conference in Tokyo, Chuo Ward, Shingo Katsukutani, Coincheck Inc said that the coins were sent “illicitly” outside the venue. Co-founder Yusuke Otsuka said the company didn’t know how the 500 million tokens went missing, and the firm is working to ensure the safety of all client assets.
Otsuka said that they know where the coins were sent and if they continue the tracing, it may be possible to recover them.
This hack is the largest in terms of worth stolen since the digital cryptocurrency, Bitcoin was launched in 2009.
What is NEM?
NEM(Nemu) is the world’s 10th largest cryptocurrency by market value founded by Yusuke Otsuka on March 31, 2015. It is peer-to-peer cryptocurrency and blockchain platform written in Java with a C++ version in the works.
NEM has a stated goal of a wide distribution model and has introduced new features to blockchain technology such as its proof-of-importance (POI) algorithm, multisignature accounts, encrypted messaging, and an Eigentrust++ reputation system.
How did the hack happen?
According to the Coincheck, on the morning of 26th, the stability of NEM remarkably decreased and it stopped trading and dispensing in the afternoon.
However, the exact amount of hack cannot be figured until further checks, data suggests that the figure is now at least over $400 million, factoring the decline in the value of XEM, the NEM protocol’s tokens.
In the virtual currency, many exchanges take safer measures, such as storing data on a computer that blocked access from the net to prevent such troubles, but the Coincheck did not correspond to NEM. “There is a technical difficulty in going offline (keeping it with the Internet)” which was short of human resources “(President Wada). Yusuke Otsuka said the director “was handling as much as possible as a position to keep assets,” reported Japanese Asahi(as per Google translate).
In response to the hack, the prices of other cryptocurrencies, including Bitcoin have fallen.