Grand Theft NEM Pins Back Bitcoin

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Hackers apparently made off with the equivalent of 58 billion yen ($532 million) in digital currency, which would make it the biggest theft to date in the budding world of virtual money. But Coincheck said that the method was not used to store NEM coins. The largest cryptocurrency theft up until this point was the Mt. Gox one in 2014 that amounted to $340 million, but that one had a larger impact on the industry as the market cap is much higher now than it was then.

Coincheck, which calls itself the leading Bitcoin and Cryptocurrency exchange in Asia, said it had detected the unauthorized access to the system shortly before 3 am Friday (1800 GMT Thursday).

NEM is a digital now like Bitcoin, Ethereum, or Litecoin, and is presently the eight largest cryptocurrency by volume. "We are advising our customers to avoid making deposits until the restriction on NEM has been lifted". The Coincheck hack has brought up memories of the infamous Mt. Gox hack that saw hundreds of millions of dollars in Bitcoin stolen and led to the collapse of the Japan based Bitcoin exchange.

Billionaire investor George Soros, known for his legendarily successful currency trading, has dismissed bitcoin as a "typical bubble".

Wong also said people shouldn't panic yet, until we know more about this. Japan's Financial Services Agency said in its statement that it is "looking into the facts surrounding Coincheck".

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Cryptocurrency exchanges are central targets for criminal activity right now, especially since bitcoin reached exponential heights at the end of previous year.

All told, about 500 million XEM tokens, worth roughly $420 million, was stolen from Coincheck, according to Bloomberg.

Coincheck, one of the major cryptocurrency exchanges in Japan, attracted many customers by offering trade in a number of virtual currencies, and by spending heavily on advertising. "We are tracing them and if we're able to continue tracking, it may be possible to recover them, but it is something we are investigating at the moment".

Coincheck said it isn't aware of how its service was compromised. An earlier hack, a comparatively modest 1,500 bitcoins, in May 2015 lost $350,000 in user funds.

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