Every year, nearly billions of dollars worth of cryptocurrencies are being hacked from various crypto exchanges. These hackers use crypto mixers like Tornodo Cash to launder money. Despite stringent security structures, phishing attacks have become a norm in the crypto world. This has raised the community’s concern over the protection of their funds and the vulnerability of the crypto exchange.
Recently, DMM Bitcoin, a Japanese crypto exchange launched in 2018, is about to close its services and transfer all the customer assets to SBI VC Trade. The crypto exchange suffered a private key hack in May that resulted in the loss of Bitcoin 4502.9 BTC worth around $305 million at that time. They tried to recover the losses but failed, resulting in the exchange shutting down.
According to a statement released by the exchange, DMM Bitcoin reached an agreement with the SBI VC Trade, a crypto exchange operated by the SBI Group, on November 29, 2024. As per the terms of the agreement, around March 2025, all customer accounts and custody assets will be transferred to SBI VC Trade. They stated that the main reason behind the transfer was to protect the customer’s interest. Furthermore, SBI VC Trade said it would start trading 14 new cryptocurrency spot trading that DMM Bitcoin handled before the transfer.
On May 30, 2024, DMM Bitcoin servers were breached, leading to the hacking of a private key and a loss of over 4,500 BTC from a single wallet. After the hack, the exchange restricted the use of various services like the withdrawal of crypto assets, new account registration, and the acceptance of purchase orders for spot cryptos. They also promised to compensate the customers by acquiring an equivalent amount of Bitcoin by gaining financial support from their group companies. However, the heavy loss led to the liquidation of the exchange.
In July 2024, ZachXBT, a blockchain analyst, tweeted on X that more than $35M from the DMM Bitcoin hack were laundered through Huione Guarantee, a marketplace widely used by scam operators. Furthermore, he also noted that the techniques used for laundering the money resemble the methods of the Lazarus Group, a North Korean cybercrime organization.
Bitcoin’s Genesis Wallet Hack Stirs Concerns Over SecurityBecause of the hack, DMM Bitcoin has been under heavy pressure. The exchange discontinued a project they had been developing called Seamoon Protocol, a Web3 gaming and content platform, in November 2024, citing changes in the business environment.
The hack of DMM Bitcoin marks the second largest in Japan, with the first being the Coincheck hack in 2018, which resulted in a loss of $530 million. When compared to other various hacking incidents worldwide, the DMM hack also ranks among the top. In addition to the DMM hack, the Lazarus Group has been responsible for other major hacking incidents, including attacks on WazirX in July, Indodax in September, and more.
