Japanese exchange Bitpoint will repay customers after crypto hack

Of the JPY 3.02 billion stolen, about JPY 2.06 billion ( USD 19 million) belonged to Bitpoint customers and about JPY 960 million ( USD 8.9 million) were Bitpoint assets.

The hacker was able to gain access to Bitpoint’s hot wallet and it’s alleged that Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Litecoin (LTC), and Ripple (XRP) were then transferred to wallets controlled by the attacker.

The exchange responds

Bitpoint has suspended all services, including the opening of new accounts. The company stated, “We will make every effort to identify the cause, develop preventive measures, and review our business management system as soon as practicable, while seeking support from outside experts, and strive to continue our business.”

However, the roughly 50,000 Bitpoint customers who lost funds due to the hack will be reimbursed. Customers will receive refunds of crypto on a 1:1 basis reports The Asahi Shimbun.

Following the incident, Remixpoint’s shares fell sharply. In addition to short-term concerns over business performance, there are worries over the impacts on the company’s mid-term performance due to a reduction in credibility and a tightening of regulations by Japan’s Financial Services Agency (FSA).

An uncertain future

The Bitpoint incident is the third-largest exchange hack in Japan. Coincheck, a leading cryptocurrency exchange, lost cryptocurrencies worth about JPY 58.0 billion (about USD 540 million), due to a hack in January 2018. While Zaif lost cryptocurrencies worth about JPY 6.7 billion in September 2018. Following those incidents, the two exchanges were acquired by listed companies in Japan to facilitate business improvement. However, the circumstances are slightly different this time because Bitpoint is already a subsidiary of a listed company. Japan’s FSA is currently considering a large number of applications for new exchanges. Whether the new incident will accelerate a restructuring of the cryptocurrency industry in Japan or result in the implementation of more stringent regulations will be watched closely by the local industry.