Some digital currency exchanges have successfully made their mark, but it is not the case with all the cryptocurrency exchanges out there. Recently, a Japanese exchange Coincheck lost about $550 million NEM, and this all happened due to brutal hacking.
This is why Coincheck has decided to stop dealing in Zcash, Dash, and Monero. The reason this exchange has decided to stop dealing in these digital currencies is that it has realized the threats that these cryptocurrencies may pose to the exchange.
The real problem is that mentioned digital currencies facilitate the anonymity of the users. Coincheck is trying hard to recover from this catastrophe. This exchange has understood the fact that it is close to impossible to identify the fund recipient when dealing with Monero, Dash, and Zcash.
This is why money laundering becomes so easy with these digital currencies. On the contrary, money laundering is not quite easy with Bitcoins. This is why the exchange wants to play safe and wants to avoid the losses shortly.
However, this sudden decision may lead to many changes in the infrastructure of Coincheck. At the moment this exchange has applied for registration as per the revised payment law.
This registration is still pending, and Coincheck applied for this registration way back in September before the terrible hacking incident. To win the goodwill of the customers, Coincheck has also decided to compensate the customers who lost money in NEM currency.
The exchange has refunded about ¥46.6 billion to about 260,000 customers. The main objective of this action is that the exchange does not want the customers to lose their trust in Coincheck. This massive loss can seriously hamper the reputation of the exchange, and apparently, it seems that Coincheck has understood this fact.
This is why they are proactive and willing to calm the disturbed customers. The experts believe that by now the hackers may have converted half of NEM into other digital currency. This situation does sound alarming, and it is necessary that Coincheck should review its entire infrastructure.
At the moment the real challenge is to track the missing coins, but this effort is needed. The customers should also make sure that they should not invest in digital currencies that are more focused on anonymity. Letting go off vulnerable currencies is perhaps the best way to discourage all the hackers out there.
Let us hope that this exchange does not suffer from a similar situation again in the future.