Zaif users started experiencing issues with withdrawals and deposits on September 14, but it wasn’t clear whether it was something to do with maintenance issues or not. However, Zaif exchange discovered that their hot wallets were breached, and the culprits have managed to escape with £45.49 million ($60 million).
Bitcoin, Monacoin, and Bitcoin Cash stolen
According to Zaif, the cryptocurrencies that were stolen during the hacking incident included 5,966 bitcoins (BTC), and an undisclosed amount of Monacoin (MONA) and Bitcoin Cash (BCH). The estimated value of the lost coins as per the company’s investigation is the equivalent of around 6.7 billion yen, roughly £45.9 million.
The impact on customer’s digital assets
Amongst the £45.49 million (6.7 billion yen) stolen, Zaif says that £14.9 million of the $45.49 million lost was its own digital assets, and the remaining amount belonged to customers, approximately £30.55 million.
Once Zaif confirmed that their exchange had been breached, they reported the matter to the Treasury Department, analysed the cause, and declared it as a criminal case to the authorities. The company further noted that they are now striving to secure the lost financial resources of customers.
FISCO Digital Group steps in
Zaif has confirmed today that their asset reserves amount to roughly £16.2 million. To improve on this position, they have concluded an agreement with FISCO Digital Group Co., to acquire £32.4 million as an investment in return for a majority share of their stock to keep the exchange operating healthily.
Additionally, the company has also entered into a deal with Kaica Corporation for technology to further improve the security of their exchange.
Japan’s cryptocurrency exchanges have been under close regulatory scrutiny
Since the hacking of a Tokyo-based crypto exchange, Coincheck, in January, cryptocurrency exchanges in Japan have been under close regulatory scrutiny. The Financial Services Agency (FSA) noted that it found sloppy management at numerous crypto exchanges, including a lack of proper security measures to safeguard clients’ digital assets.
This latest hack on Zaif is indicative of the FSA’s observations.