In what has been tagged as one of the biggest hacks of all time, Tokyo police’s cybersecurity department is not relenting in its efforts to fish out the perpetrators of the Coincheck hack that saw over $526 million worth of NEM moved from the exchange. So far, one person has been questioned as he exchanged a little fraction of the stolen NEM into litecoin.
Nikkei Asian Review reported on February 11 that Tokyo police had questioned a Japanese man who is suspected to have a hand in the Coincheck exchange hack carried out in January.
According to sources close to the investigation, the suspect happens to be quite conversant with the dark web, and has converted an insignificant amount of the missing NEM coins into litecoin via a crypto exchange on the Dark Net, the source said.
The Dark Net is a part of the internet that cannot be retrieved by search engines and using a standard browser, with sites hidden from the world wide web; this part of the internet is only accessible by installing special software like the Tor browser. Authorities say the man was aware the cryptocurrency had been stolen from Coincheck.
The cybercrime department of the Metropolitan Police, which questioned the man on a voluntary basis, thinks there are several other people involved in converting the NEM and is vigilantly watching websites on the Dark Net and all NEM transactions to see if it would identify the stolen coins.
The NEM.io Foundation, a non-profit entity promoting NEM in Singapore, has tagged the missing NEM coins for easier tracking.
1/ @coincheckjp hack update: NEM is creating an automated tagging system that will be ready in 24-48 hours. This automated system will follow the money and tag any account that receives tainted money. NEM has already shown exchanges how to check if an account has been tagged.
— Inside NEM (@Inside_NEM) January 26, 2018
Although NEM is not one of the privacy-centric coins like monero and some others, it might still be impossible to recover the stolen cryptocurrency completely.
January 26: A Bad Day for NEM
January 26 was an unfortunate day for Coincheck and the entire cryptocurrency community as a total of about 58 billion Japanese yen ($538.8 million) worth of the NEM cryptocurrency was stolen from the exchange by hackers who are yet to be identified.
Data Security experts have said that roughly 500 million yen ($4.6 million) worth of the coin has since been converted into bitcoin and some altcoins. The perpetrators of the heinous attack are professionals in their game and have expertly split and dispersed the stolen blockchain-based money between an array of digital addresses, making it almost impossible to recover.
The Coincheck cyberheist was partly due to carelessness on the part of the exchange. The NEM coins were stored in an internet-enabled wallet (hot wallet) instead of keeping it safely in an offline digital purse (cold storage).
On January 27, BTCManager reported that Coincheck promised to reimburse investors however the date of the refund is yet to be fixed.