The NEM.io Foundation, creators of the peer-to-peer NEM blockchain platform, has announced that it traces the funds stolen in a recent hack on the Japanese cryptocurrency exchange Coincheck.
On January 25, 526 million XEM were reported missing from wallets on Coincheck due to a massive security breach of the Coincheck wallet.
The Foundation explained that the decentralised NEM protocol’s flexibility allows transactions to be traced in real-time, which helps exchanges to identify wallets attached to malicious activity. This, in turn, makes stolen XEM tokens effectively unusable, because they cannot be deposited without being flagged by NEM.
Leveraging the decentralized API, the NEM Foundation’s automated tagging system is tracing stolen funds from the hack, with the objective of identifying wallets holding stolen funds. By tagging stolen funds, anybody can easily verify if stolen NEM funds are distributed to regulated trading platforms.
“The NEM protocol’s powerful decentralised API allows anybody to track these funds in real-time, allowing exchanges to determine if deposits were stolen,” said Jeffrey McDonald, Vice President of the NEM Foundation. “We’re actively working with Coincheck and other exchanges to ensure proper handling of this breach. NEM.io Foundation will continue to provide updates as the situation unfolds.”
The NEM.io Foundation assured users that NEM blockchain platform remains secure, along with all NEM mobile wallets and NEM NanoWallets. It urged the whole cryptocurrency community to take proper security measures, such as using multi-factor authentication and hardware wallets.
