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Virtual Currency Exchanges in Japan Should Enhance Security Measures: Bank of Japan (BOJ) Chief

Updated:2018-2-1 10:02:08    Source:www.tannet-group.comViews:431

According to the Bank of Japan (BOJ) Governor Haruhiko Kuroda, the operators of virtual currency exchanges should step up measures to explain potential risks to investors and enhance security measures.

"Providers of cryptocurrency services need to explain risks to investors proactively and take sufficient security steps," Kuroda was quoted as telling a Diet session on Wednesday.

He added that for virtual exchanges, "stability and safety" of their settlements and services are paramount and that investors must be made aware of the risks of transactions using cryptocurrencies.

The central bank chief's remarks were made after Tokyo-based Coincheck Inc. said it had lost 532 million U.S. dollar's worth of NEM cryptocurrency in a hacking attack.

On Jan. 26, the virtual currency exchange halted the majority of its operations, stating later that all of its customers' holdings of the lesser-known NEM cryptocurrency coins had been stolen.

The losses of the NEM cryptocurrency in the Coincheck cyber-heist were the largest ever in a security breach.

Coincheck said that 260,000 of its customers affected would be compensated for the 46 billion yen (432 million U.S. dollars) in cash that was lost at the time.

Many customers were irate, however, because the amount reflected a lower rate of NEM coins, as the announcement was made after news of the possible theft had become public.

On Monday, Japan's financial watchdog issued a business improvement order to Coincheck for not having sufficient security measures to prevent such attacks, with agency officials also saying the company has a poor standard of customer service.

The agency instructed Coincheck to investigate the cause of the security breach and report its future preventative measures back to the it by Feb. 13. (Source: Xinhua News)

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