Thursday, December 13, 2018
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Japan punishes crypto exchanges after hack

Japanese authorities Thursday ordered two cryptocurrency exchanges to suspend operations as part of a clampdown following a massive hack that saw thieves steal hundreds of millions of dollars in virtual currency.
The Financial Services Agency (FSA) said in a statement it had ordered FSHO and Bit Station, exchanges based in Yokohama and Nagoya, to temporarily halt their operations for a month from Thursday.
The agency alleged that FSHO"does not have a proper system to monitor trading and has not given training to its employees,"while an employee of Bit Station"diverted digital currency deposited by clients for his personal use."
Immediate comments from the two exchanges were not available. Authorities also ordered five other exchanges, including Coincheck, to improve their business practices. Coincheck was already slapped with sanctions in January following the hack.
The hack of Coincheck -- resulting in the disappearance of NEM cryptocurrency worth $530 million -- was one of the largest of its kind, and prompted authorities to search the firm's office last month. The company has already pledged to reimburse about $400 million to all 260,000 customers who lost their holdings of NEM, then the 10th biggest cryptocurrency by market capitalisation.
But it is unclear how and when the money will be returned.
Following the fresh FSA order, Coincheck vowed to"thoroughly review its management"and take measures to protect its depositors and deal with money laundering and funds for terrorists."Once again we apologise to our customers and people concerned for causing a lot of trouble and worries,"the company said in a statement, promising to"do its best"to regain confidence.


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