Business / Tech

About 50,000 Bitpoint Japan customers had cryptocurrency stolen

Kyodo

Cryptocurrency exchange operator Bitpoint Japan Co. said Tuesday that around half of its 110,000 customers have been victimized by the recent hacking in which digital currencies worth ¥3.02 billion ($27 million) were stolen.

Bitpoint Japan President Genki Oda apologized for the incident at a Tokyo news conference and vowed to fully return the stolen assets in virtual currencies after the company resumes services that were suspended following Thursday’s hacking.

But he said the timing of restarting the suspended services and transactions remains unclear, as the theft is still being investigated.

In addition to the ¥3.02 billion hacked in Japan, Bitpoint has said an additional ¥250 million worth of digital currencies have been stolen at overseas exchanges that use its trading system. The company said it reported the initial theft to police on Friday morning.

The theft occurred as its so-called hot wallet system that is connected to the internet and stored five kinds of cryptocurrency — bitcoin, bitcoin cash, ethereum, litecoin and ripple — was attacked via unauthorized access, it said.

Of the ¥3.02 billion, ¥2.06 billion was held by customers and ¥960 million was kept in the company’s deposits. The assets stolen from the customers accounted for some 13 percent of the total digital money entrusted to Bitpoint.

Oda said he will not step down and that the company will further investigate how the assets were stolen with support from outside experts.

Bitpoint Japan, which was established in 2016, was among six cryptocurrency exchange operators ordered by the financial watchdog last year to improve internal controls, including management of customers’ assets.

The incident came as the Financial Services Agency has been tightening regulations for cryptocurrency exchange operators after digital money worth around ¥58 billion was stolen from Tokyo-based cryptocurrency exchange Coincheck Inc. last year.

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