DMM Bitcoin is shutting down after losing $320 million in a May 2024 hack affecting over 4500 Bitcoin.
Customer assets will be transferred to SBI VC Trade in March 2025 following the company’s shutdown.
Japan is tightening crypto regulations to protect assets and prevent outflows after recent exchange failures.
DMM Bitcoin, a prominent cryptocurrency exchange in Japan is preparing to close its doors after a major hack. The exchange lost $320 million worth of Bitcoin. This was one of the biggest crypto hacks in Japan. The loss has forced DMM Bitcoin to cease operations and seek alternatives for its users.
https://twitter.com/RoundtableSpace/status/1863452527196574076 The May Attack and What Happened
The hack occurred on May 30, 2024, when attackers compromised DMM Bitcoin’s servers. The hackers hacked into one wallet, stealing more than 4,500 Bitcoin. DMM Bitcoin, however, at that time, assured customers that all deposits would be fully guaranteed.
The scale of the breach was too significant for the company to manage. Withdrawals and new account registrations were halted. The company also promised to secure replacement funds through its affiliated companies. Despite these efforts, the stolen Bitcoin could not be recovered.
With this, the attack is now considered the second largest crypto hack in Japan. The first was the 2018 Coincheck breach, where $530 million was lost. After the DMM Bitcoin attack, blockchain investigator ZachXBT found $35m from the stolen crypto laundered through a marketplace called Huione Guarantee. He concluded that the Lazarus Group could be responsible for the attack. He based his argument on the laundering techniques that were employed.
Customer Assets to Be Transferred to SBI VC Trade
As part of its winding up process, DMM Bitcoin has agreed to transfer customer assets to SBI VC Trade.
SBI VC Trade is an exchange under the SBI Group. The transfer is to take place around March 2025. Customer deposits in the form of cryptocurrencies and Japanese yen will be moved to the new platform.
DMM Bitcoin has also confirmed that it will stop margin trading and unresolved positions on the same transfer date. The aim of this move is to ensure a smooth transition for users. The details of the transfer are to be finalized over the next few months between DMM Bitcoin and SBI VC Trade.
The Financial Services Agency started pushing for stronger regulations in the crypto sector in response to the DMM Bitcoin hack. The agency aims to protect the customer's assets. Japan has made some recent changes to corporate tax rules for cryptocurrency companies.
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