Hacked Zaif Crypto Exchange is Compensating Users after 6,000 BTC Heist

Japanese crypto exchange Zaif experienced a significant hack. Hackers stole approximately 6.7 billion yen (~$60 million) in cryptocurrencies from the platform’s wallets. About half of the funds belonged to the platform’s customers.

The platform’s operator, Tech Bureau, confirmed that the hack occurred on September 14, 2018. Hackers were able to successfully breach hot wallets, which are online connected wallets) that contained Bitcoin, Bitcoin Cash, and Monacoin.

According to Japanese news platform Nikkei, Tech Bureau did not detect the hack until September 17. Upon detection, the operator suspended deposits and withdrew services. The operator also approached the Financial Services Agency (FSA), the country’s financial regulator, and reported the breach and an investigation is currently underway.

Zaif responded to the attack, noting that it is unable to ascertain the exact amount of Monacoin and Bitcoin Cash stolen. In its statement, it said:

The reason for not being able to determine the damaged quantity at the moment is that the server is not restarted until the reliable safety can be confirmed in order to prevent secondary damage. As soon as the quantity of the lost virtual currency is determined, we will report it promptly.

Tech Bureau, in an attempt to compensate customers for their losses, is selling a majority of its shares to Fisco Digital Asset Group, a publicly-listed financial services corporation in Japan. Further, the exchange signed an agreement that will inject 5 billion yen (~$44.49 million) in exchange for a majority ownership. The funds will be used to compensate customers for their losses.

Interestingly enough, before the attacks, Zaif received a “business improvement order” from the FSA in June. And the platform has been under increased scrutiny after a $530 million theft from Coincheck, an unlicensed exchange.

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