Second Major Hack Casts Doubts over Japan’s Cryptocurrency Security Systems

Another Cryptocurrency Exchange Hacked

In the evening of September 14, 2018, the Osaka-based Tech Bureau’s Zaif cryptocurrency exchange was hacked, resulting in the theft of approximately ¥7 billion of cryptocurrency (in the form of Bitcoin, Bitcoin Cash, and Monacoin). The hack was not discovered until three days later, on September 17. A report was made to the regional finance bureau and news of the security breach was announced just before three in the morning of September 20.

This was not the first incident to affect Japanese cryptocurrency exchanges in recent months. In January this year, a hack at Coincheck resulted in the theft of around ¥58 billion of NEM tokens, prompting the Financial Services Bureau to take steps to bolster its monitoring systems. Zaif itself had received two business improvement orders from the Kinki local finance bureau. Since Coincheck operates without formal registration, having been in business since before the amended Payment Services…