Business 22 April 2019Neil Mathew
Japan’s Zaif crypto exchange resumes services under new management
Japan-based cryptocurrency exchange Zaif announced that it is resuming its activities under new management, several months after falling victim to a hack that caused it to lose $60 million worth of cryptocurrencies.
Zaif used to operate under Tech Bureau, an influential financial services firm based in Osaka, Japan. The exchange was hacked over six months ago to the tune of JPY6.7 billion, or about $60 million. Many criticized Zaif for its lack of security measures, arguing that it damaged the credibility of the cryptocurrency markets in general.
The hack was the second high-profile hack that occurred in Japan in 2018, which led the Financial Services Agency (FSA) to look more closely at the security in the cryptocurrency sector. A substantial amount of cryptocurrencies were stolen from the exchange, including a significant amount of Monacoin (MONA). MONA has experienced a price pump of 40% since the announcement, as well, with some stating that it might be due to the fact that Zaif is resuming trading activity. In fact, those who lost MONA as a result of the hack will be reimbursed at a rate of $1.29 per MONA. When one considers that MONA was only worth $0.50 at the time of the attack, this is quite a reasonable and fair rate.
The first high-profile hack was the Coincheck hack of January 2018, where over $500 million was stolen in arguably the largest cryptocurrency theft of all time. Coincheck was also able to resume trading months after the hack, as well, which is a great sign for the Japanese cryptocurrency markets. It should also be noted that the cryptocurrency markets are extremely popular in Japan, as well, where Bitcoin is considered legal tender.
After the hack, Zaif reached an agreement with Japanese firm FISCO to obtain majority ownership, as it could not cover the losses incurred. FISCO took ownership of the business in November 2018.
The business will be transferred to Fisco Digital Asset Group on April 22, 2019, and normal activity will resume the following day. When Zaif reopens, those who have lost money will apparently be paid back in 60% cryptocurrency and 40% fiat currency.
Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.
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