CAPE TOWN - Japanese digital currency exchange, Coincheck, said it will refund most of the 58 billion yen worth of virtual assets that were lost during a hacking attack last Friday.
The attack saw the bitcoin wallet company losing their NEM cryptocurrency worth R6.3 billion. The hacking attack affects some 260 000 customers after the trading suspected “unauthorised access” of its digital exchange. The Tokyo-based company said on Sunday that the amount it has promised to return, covers almost 90% of the 58 billion yen worth of NEM coins lost in the attack.
Following the breach, the company froze deposits and withdrawals for all cryptocurrencies, except Bitcoin. The stolen Coincheck assets were allegedly kept in a “hot wallet”, connected to the internet instead of a “cold wallet” where funds are stored securely offline.
The company says that they have the digital address of where the assets were sent. According to the company's chief operating officer, Yusuke Otsuka, 523 million NEMs had been sent from Coincheck's NEM address during the breach.
"It's worth 58 billion yen based on the calculation at the rate when detected," he told reporters at the Tokyo Stock Exchange. "We know where the funds were sent. We are tracing them and if we're able to continue tracking, it may be possible to recover them", said Otsuka.
Meanwhile, the central bank governor of Nigeria, where bitcoin trading grew the most in Africa last year, said investing in the cryptocurrency is a “gamble” and said that it may have to be regulated.
“Cryptocurrency or bitcoin is like a gamble, and there is a need for everybody to be very careful,” Central Bank of Nigeria Governor Godwin Emefiele said in an interview on Wednesday at his office in the capital, Abuja. “We cannot as a central bank give support to situations” where people risk savings to “gamble,” he said.
Emefiele is among many regulators globally who have expressed concern about the cryptocurrency. The concern stems from bitcoin’s high volatility and the perception that it facilitates crime.
Despite this, demand for the digital currency is escalating in West Africa’s biggest economy. According to data from LocalBitcoins, peer-to-peer transactions rose by almost 1 500 percent this year, second to China.
Yet, Emefiele remains unconvinced. “I have asked my colleagues in the research and monetary-policy department to study the market and get to know what the issues are,” Emefiele said. The central bank may in future “make some very concrete pronouncements as to the direction,” he said, without giving details.
- BUSINESS REPORT ONLINE