Economy

Crypto Exchanges Raided By Japan's Financial Agency

Crypto Exchanges Raided By Japan's Financial Agency

Finance Minister Taro Aso said on Friday that the agency's officials have begun inspections at several cryptocurrency exchanges.

On Jan. 26, Coincheck lost nearly all cryptocurrency NEM assets of some 260,000 customers, worth some ¥58 billion at the time, due to unauthorized access to the company's computer system.

Following the massive theft of the digital money on January 26, the data security specialists have found an account believed to be used by a perpetrator of the heist for trading the stolen NEM through the dark web.

Since the attack, the company has said it will refund users who lost NEM in the hack - a promise that has seen an on-site investigation by Japan's financial watchdog, the Financial Services Agency (FSA), to ascertain Coincheck's ability to honor the proposal.

The company said Friday it will resume services to allow the withdrawal of yen from next Tuesday.

Coincheck suspended withdrawals of deposits in yen as well as in virtual currencies after the theft of its assets. Exchange operators are required to register under the revised funds settlement law which took effect last April.

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"We have started on-site inspections on multiple operators to examine their internal management systems, including system risk management", said Aso.

The FSA will check safety measures for the cryptocurrency exchange operators' computer systems and their methods for managing customer assets, and will apply administrative penalties if problems are found, the sources said.

Aso said the agency made a decision to inspect the operators after looking into their reports.

The heist has prompted debate about whether and how to regulate such digital currencies, which have gained popularity globally.

While issuing a business improvement order to Coincheck and launching an inspection on the exchange operator, the FSA ordered others in the same industry to check their system administration and business management setups and to submit reports on them.