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Japanese cryptocurrency exchange BitPoint has just announced that is the victim of a hack. Its hot Unlike the physical wallet in your back pocket, a cryptocurrency wallet doesn’t actually store currency but the keys to a... More used to store funds online was compromised. This attack means close to $32 million in user funds are gone.
According to BitPoint, the hack occurred at 22:12 Tokyo time on July 11th, 2019. The stolen amount is equivalent to 3.5 billion Japanese Yen (JPY). Out of this, approximately 2.5 billion JPY belonged to BitPoint Japan’s customers, and the remaining 1 billion JPY belonged to the company itself.
As a result, Remixpoint Inc, the parent company of BitPoint Japan, witnessed a 19 percent drop in its share price. That drop is unlikely to be the end of the losses either. As of 13:44 Tokyo time a huge sell wall of Remixpoint Inc. shares has already piled up indicating shareholders are looking to abandon ship as soon as possible.
This is a huge set back for both Remixpoint Inc. and its subsidiary BitPoint after the former made a 2 billion JPY investment into virtual currencies earlier this year. Historically, Remixpoint Inc. has focused the majority of its efforts in the energy and automotive-related business sectors. So, it is safe to say its recent venture into the cryptocurrency space has not been successful.
Other Japanese cryptocurrency exchanges have suffered similar attacks as well. Previously, in the third quarter of 2018, Osaka-based cryptocurrency exchange Zaif reportedly lost nearly $60 million to hackers. There was also another incident earlier in 2018 when Coincheck, another Japanese crypto-exchange suffered one of the largest hacks of all time after some $534 million in tokens was exfiltrated from the exchange.
Between these hacks, the one common link has been the use of low-security hot wallets. BitPoint has ceased all operations as of now and is investigating the matter further by checking the integrity of all of its hot and cold wallets.
Although the exchange has assured affected users that it will try to compensate customers and shareholders for any funds lost, there is no indication as to where that money will come from.
What do you think should be done to avoid further hacks like this in the future? Are there any truly hack-proof cryptocurrency exchanges? Let us know your thoughts in the comments!
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