Following the widely-publicized hack that took place in one of Japan’s largest cryptocurrency exchange, Coincheck, the trouble-makers are back again.
Last week, hackers breached security protocols and depleted $530 million from Coincheck. On Tuesday, the NEM Foundation, creators of the XEM cryptocurrency, said it has traced the stolen coins to an unidentified account, and the account owner had begun trying to move the coins onto six exchanges where they could then be sold off, Jeff McDonald said.
With the hack, questions pertaining to security and regulatory measures on cryptocurrency funds, did the rounds once again. So far the location of the hackers’ account has not yet been traced.
Singapore-based McDonald said, “The hackers are] trying to spend them on multiple exchanges. We are contacting those exchanges.” NEM spokesperson Alexandra Tinsman said the hacker had started sending out “XEM” coins to random accounts in 100 XEM batches, worth about $83 each.
Tom Robinson, co-founder of Elliptic, a cryptocurrency security firm in London said, “When people look to launder these types of funds, they sometimes spread it into smaller transactions because it’s less likely to trigger (exchanges’) anti-money laundering (mechanisms).”
Robinson added that such hoppings were becoming more and more commonplace among cyber criminals trying to hide their tracks. The coins that the hackers had taken was around 5% of the total XEM supply, which according to CoinMarketCap ranks in the first 10 cryptocurrencies.
The aftermath of the hack was felt most keenly by Coincheck. They were publicly reprimanded by the FSA which regulates the cryptocurrency exchanges in Japan. They had also announced that they would be refunding the stolen amount, which was no feat in itself.