![]() One of the reasons cited is that all NEM funds were stored in a single ‘hot-wallet’, which is connected to the internet, presenting an easy target for the hackers, as opposed to a more secure ‘cold wallet’, which can be stored offline. Thus, preventing nodes from having an advantage through pure processing power, something that is evident in many other blockchains.Īlthough NEM was the only platform to be affected, the hack is said to be a result of Coincheck’s poor security measures. The big advantage of PoI is that transactions do not require validation through processing power as it is not hardware intensive. This process ensures that all the nodes of a network agree with each other and determine who can ‘harvest’ transaction fees. Secondly, as opposed to Bitcoin and most other mining cryptocurrencies which use a proof-of-work consensus, NEM uses a proof-of-importance (PoI) consensus. A process of generating blocks and allowing stakeholders to earn transaction fees in that block as a reward for the contributed work. Two features set it apart from Bitcoin.įirstly, NEM uses ‘harvesting’ instead of mining. As stated on their website, ‘NEM’s blockchain platform was designed and coded from the ground up for scale and speed’. NEM (New Economy Movement) is a peer-to-peer network that launched on 31st of March 2015. The article has been created through the KCL Blockchain Team. This not intended for Legal or Financial Advice, this is for personal and educational study only. The real question after this attack is: Should Coincheck reimburse its' customers? The gravity of the Coincheck hack supersedes the attack on Mt Gox and once again highlights the vulnerabilities and risks that come with trading an asset which regulators have struggled to keep up with, as well as casting doubt over the future of cryptocurrencies. However, the hack caused it to suspend all trading and it filed for bankruptcy not long after. The CEO of Mt Gox, Mark Karpelès, was apprehended and cannot exit Japan until a verdict is given to embezzlement and data manipulation chargers. ![]() At its peak, in about 2013, Mt Gox was handling over 70% of all bitcoin transactions at the time, making it the largest bitcoin exchange in the world. In 2014, Mt Gox, a Tokyo-based bitcoin exchange platform, was targeted by a massive attack, from which it lost approximately 850,000 bitcoins, worth roughly $450 million at the time. This is not the first time that Japanese exchanges have fallen victim to such an attack. ![]() The Coincheck security breach sent a shockwave through the Japanese cryptocurrency business community, which is now gearing up to take unified action in order to prevent future incidents and bolster its reputation.Just over a month ago, on Friday 26 January, Japan’s cryptocurrency exchange, Coincheck, was subject to the biggest cryptocurrency exchange hack yet, with hackers stealing 500 million NEM tokens (XEM coins) (worth approximately $530 million). BIG has declined to share the details of their investigation, but says they have contacted the relevant authorities. The Blockchain Intelligence Group claims to have tracked some of the funds to a Vancouver-based cryptocurrency exchange. Meanwhile, there appears to be some positive progress when it comes to tracking the stolen funds. The Japanese exchange has stated that it has no plans to cease operations and that they will be able to reimburse the vast majority of the customers’ losses. The plan is to refund XEM at the rate of 88 yen per coin, but an official timeline has not yet been set. In the last 24 hours, Coincheck has handled $32.69 million in trade volume, making it only the 32nd busiest cryptocurrency exchange.Ĭoincheck promised refunds sourced from the company’s own capital to the 260,000 customers who were affected by the theft of XEM tokens. ![]() The exchange’s functionality is still limited with only the JPY/BTC trading pair being available, and new user registrations are suspended. In a single day, more than ¥40.1 billion (around $373 million) was withdrawn from the exchange. Two weeks after the hack, Coincheck’s customers were able to withdraw their JPY funds from the exchange after the assets were frozen immediately following the security breach. The Japanese cryptocurrency exchange Coincheck is trying to get back on its feet after losing more than $500 million worth of XEM in a January cyber attack.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |