One of Japan's lesser known crypto exchanges, DMM Bitcoin, lost 4,500 bitcoins worth over $300 million in a hack last week. This is the largest attack on a crypto company since the FTX collapse in November 2022.
In a Japanese blog post, DMM Bitcoin shared the impact of the hack with the public. The exchange described the incident as an "unauthorized leak" of 4,500 bitcoin (BTC). DMM Bitcoin has already taken measures to prevent further unauthorized outflows. The exchange did not provide further details about the incident, but assured customers that the total amount is guaranteed.
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Another Japan based exchange gets hacked
Shortly before the blog post was published, the exchange restricted spot purchase orders and added a message stating that withdrawals in Japanese Yen may take longer than usual. DMM Bitcoin did not disclose whether an outsider was involved in the hack. Japan's Financial Services Agency (FSA) is also investigating the incident. With the help of other companies in the group, the exchange will replace any lost bitcoin.
The last attack on a Japanese crypto exchange of this magnitude occurred in 2018, when Coincheck suffered a hack worth $530 million. Additionally, Mt. Gox, one of the most famous exchange hacks in bitcoin history, was based in Japan. The DMM Bitcoin incident ranks third in terms of funds lost for a Japanese exchange. Globally, the hack ranks as the eighth largest crypto theft of all time-at least by the value of the funds at the time of the incident.
Not your keys, not your coins
Every cryptocurrency exchange hack should remind us of the "not your keys, not your coins" principle. In 2022 alone, numerous centralized service providers declared bankruptcy. In total, customers of FTX, Celsius, BlockFi and others lost over 10 billion USD. As the CVJ.CH editorial team pointed out at the time, the convenience of centralized service providers comes with additional risks. While being centralized the traditional banks in Switzerland still mitigates these risks.
For those who still want to take on the responsibility of self-custody, the first CVJ.CH webinar with Rino Borini on setting up a bitcoin wallet will take place next week.
