Japan’s DMM Bitcoin, a crypto exchange based in the country, recently experienced a significant hack that resulted in the loss of 4,502.9 Bitcoin. In response to this incident, the exchange is now planning to raise funds to purchase BTC in order to compensate its customers.
According to a report from Bloomberg, DMM Bitcoin is considering raising 50 billion yen (approximately $321 million) to address the impact of the hack and ensure that its customers are taken care of. The exchange has also stated that an investigation is currently underway to determine the extent of the unauthorized outflow that occurred last week.
This hack is being classified as the seventh-largest crypto hack ever, based on data from Chainalysis, and resulted in the loss of $305 million worth of customer funds. In a public statement, DMM Bitcoin described the incident as an “unauthorized leak of Bitcoin (BTC) from our wallet,” and reassured customers that their Bitcoin deposits would be fully guaranteed.
In response to the hack, DMM Bitcoin has committed to procuring the equivalent amount of BTC that was leaked with the support of its partners. The Japanese Financial Services Agency has advised the exchange to report on its customer compensation policies, and Finance Minister Shunichi Suzuki has emphasized the government’s commitment to preventing similar incidents at crypto exchanges in the country.
Unfortunately, Japan has seen several instances of crypto exchange hacks in the past, similar to the situation faced by DMM Bitcoin. In 2021, Tokyo-based cryptocurrency exchange Liquid fell victim to a major hack where hackers breached the servers and stole cryptos valued at $94 million. Following the incident, Liquid moved the remaining funds into cold wallets to enhance security.
Another notable hack occurred in 2018 at Coincheck, where 523 million of the exchange’s NEM coins were compromised. These incidents highlight the ongoing challenges faced by crypto exchanges in Japan, and the need for enhanced security measures to protect customer funds.
