Japanese Watchdog to Check Exchanges After $500M Stolen

The Financial Services Agency of Japan will check local exchanges after Coincheck hack
29 January 2018   325

The Financial Services Agency of Japan (FSA) will begin checking the rest of the country's bitcoin exchanges after Friday's hack of Coincheck. This is reported by Nikkei.

In addition, the FSA commissioned Coincheck to submit by February 13. report on the incident and develop measures to avoid its recurrence. It is also possible that Coincheck will be fined, the size of which remains unknown.

According to the publication, FSA will also conduct inspections of other exchanges.

In April 2017, Japan obliged operators of cryptoexchanges to pass state registration, allowing existing platforms, including Coincheck, to continue working before obtaining a license. At the moment, such licenses are owned by 16 exchanges.

On Friday, January 26, Coincheck suspended operations with the digital currency NEM (XEM), and then with the other altcoins. Payments with bank cards and Pay Easy were also suspended. Later, representatives of Coincheck confirmed the theft of 58 billion yen ($ 533 million) in the NEM (XEM) crypto currency.

Bitcoin Gold hit by Malicious Miner`s Double Spend Attack

An evil-minded miner efficiently made a double spend attack on the Bitcoin Gold network, making BTG at least the third altcoin to succumb to a network attack
23 May 2018   122

Edward Iskra, Bitcoin Gold director of communications first admonished clients about the attack on May 18, reporting that an evil-minded miner was using the exploit to steal means from cryptocurrency exchanges.The miner bought at least 51 percent of the network’s total hashpower, which provided them with temporary control of the blockchain. Gaining this much hashpower is extremely expensive — even on a smaller network like bitcoin gold — but it may be monetized in tandem with a double spend attack.

The attacker, after getting the control of the network, started depositing BTG at crypto  exchanges while also intending to send those same coins to a wallet under their control. Generally, the blockchain would resolve this by including only the first transaction in the block, but the attacker managed to reverse transactions as they had majority control of the network.

As a result, they were able to invest funds on exchanges and withdraw them again soon, after which they repealed the initial transaction. This way they could send the coins they had primarily deposited to another wallet. 

An address of bitcoin gold connected with the attack has got more than 388,200 BTG since May 16 (basically from transactions it sent to itself). All of those transactions were associated with the double spend exploit, the attacker could have stolen as much as $18.6 million worth of funds from exchanges. The last transaction was sent on May 18, but the attacker could resume it if they still have access to enough hashpower to reach the control of the blockchain.

Bitcoin gold’s developers recommended exchanges to resist the attack by reaching the number of confirmations acquired before they lended deposits to client accounts. Blockchain data displays that the attacker reversed transactions as far back as 22 blocks, allowing developers to advise raising confirmation requirements to 50 blocks.