Japan’s crypto exchange DMM Bitcoin is reportedly set to shut down following a $320 million loss due to a private key hack in May. The attack, which compromised over 4,500 Bitcoin, has proven too severe for the company to recover from, according to local media reports by Nikkei Asia.
As per reports, DMM Bitcoin intends to transfer customer assets to SBI VC Trade, an exchange operator under SBI Group, around March. These plans indicate that the platform is preparing to end efforts to overhaul its business model.
Hack Leading to DMM Bitcoin’s Shutdown
The hack occurred on May 30 when DMM Bitcoin’s servers suffered a security breach, leading to the unauthorized extraction of Bitcoin from a single wallet. Initially, the exchange assured users that all deposits would be fully guaranteed, halting withdrawals and new account sign-ups while promising to secure replacement funds through affiliated companies. However, the loss was too severe to recover from.
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This attack is dubbed as Japan’s second-largest crypto hack, after the $530 million Coincheck breach in 2018. In July, blockchain detective ZachXBT noted that $35 million of the stolen funds had been laundered through the online marketplace Huione Guarantee. The investigator added that North Korea’s Lazarus Group may be responsible due to the laundering methods and indicators involved.
1/4 So far in July 2024 more than $35M from the $305M DMM Bitcoin hack has been laundered to the online marketplace Huione Guarantee
It is suspected that Lazarus Group is behind the hack due to similarities in laundering techniques and off chain indicators. pic.twitter.com/g1ndlttBll
— ZachXBT (@zachxbt) July 14, 2024
ZachXBT added, “The laundering path for funds transferred to Huione from the DMM Bitcoin hack can be summarized as: 1) Deposit BTC to mixer from the hack. 2) Withdraw BTC from mixer. 3) Bridge funds from Bitcoin to Ethereum or Avalanche via THORChain, Threshold, Avalanche bridge. 4) Swap for USDT and bridge to Tron via SWFT. 5) Transfer USDT to Huione.”
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