05 Jun

DMM Bitcoin, a Japanese cryptocurrency exchange, has unveiled a fundraising initiative totaling 50 billion yen ($321 million). The objective is to acquire Bitcoin for compensating customers impacted by a recent security breach.

DMM Bitcoin falls under the DMM.com conglomerate, which spans various industries like entertainment, technology, and renewable energy. Keishi Kameyama serves as its CEO.

Japanese Authorities Request an Examination of the DMM Bitcoin Hack

DMM Bitcoin revealed specifics of its fundraising plan on Wednesday. Through a 48 billion yen (~ $307.8 million) capital increase and 2 billion yen (~ $12.8 million) in subordinated debt, the corporation hopes to raise money from its group companies.

The goal of this financial move is to acquire cryptocurrency assets while reducing any potential influence on the Bitcoin (BTC) market.

Yuya Hasegawa stated, "Since the exchange's plan to raise funds involves other companies that also belong to the broader DMM.com Group, it is difficult for outsiders to pass judgment on it."

The recent unauthorized transfer involved 4,502.9 Bitcoin, valued at nearly $71,000 each, marking it as the seventh-largest crypto theft as per Chainalysis. This incident underscores the ongoing security vulnerabilities in digital asset exchanges, raising concerns about their safety protocols.

Promptly responding to the breach, Japan’s Financial Services Agency has called for a thorough investigation into its origins and plans for compensating affected users. Finance Minister Shunichi Suzuki emphasized the government's commitment to enhancing security measures to prevent future breaches.

This breach is not an isolated event in Japan's crypto industry but fits into a larger trend of significant hacks, including the Mt. Gox collapse in 2014 and the CoinCheck breach in 2018. 

Mati Greenspan, CEO of Quantum Economics, highlighted the recurrent security issues in Japan's crypto landscape.

Reflecting on previous incidents, Greenspan noted, "The first was Mt. Gox in 2014 and then CoinCheck in 2018. You'd think by now people would learn not to leave their crypto on these centralized exchanges." He expressed concerns that such breaches could stall crypto adoption in Japan, as they had in the past.

Despite the challenges, the crypto sector as a whole demonstrates resilience and adaptation. Data from 2024 indicates a 20% decrease in losses due to crypto-related crimes compared to the previous year.

June 2024, Cryptoniteuae

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